The owner of Southend airport is considering making a bid to take over Flybe.
Stobart Group, which also runs regional carrier Stobart Air, confirmed its interest in Flybe yesterday following press speculation.
The company said it had considered a number of “potential structures” including taking “a non-controlling interest in a vehicle to acquire 100% of Flybe likely to be in cash”.
Stobart Group and Flybe have a range of shared interests arising from Stobart Group’s ownership of Southend airport and its aircraft leasing company and the growing franchise arrangements between the two groups’ airlines.
“As previously disclosed in October 2017, we have been reviewing alternative structures for our airline and leasing business that can play an important part in the consolidation of the regional airline sector,” Stobart said.
“It is not possible to say, at this stage, whether a transaction will take place, whether a firm proposal will be made or, if it is, the form a transaction to combine the airlines might take.
“A further announcement will be made in due course.”
Under stock exchange rules, Stobart has until 5pm on March 22 to either announce a firm intention to make an offer for Flybe or announce that it does not intend to make an offer.
Shares in Flybe rose 36% to 47p. Europe’s largest regional carrier said no approach had been made and told shareholders to take no action “at this stage”.
The airline said: “Flybe notes the recent media speculation and subsequent announcement made by Stobart Group.
“Flybe confirms that it has not received any approach from Stobart Group regarding a possible offer by Stobart Group for Flybe.
“Flybe shareholders are strongly advised to take no action at this stage. There can be no certainty that any firm offer will be made nor as to the terms on which any firm offer might be made.
“Further announcements will be made in due course as appropriate.”
Flybe is in the midst of a cost cutting drive and is trimming capacity. It saw passenger revenue rise by 8.5% to £158.8 million year-on-year in the three months to December 31 with passenger numbers up by 8.1% to 2.3 million.
“As we continue to reduce our fleet size, but face the impact of higher fuel prices and reduced foreign exchange hedging gains, we are going to be even more focused on improving our cost base,” chief executive Christine Ourmieres-Widener said when delivering quarterly results on January 31.
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