Flybe has confirmed plans to raise £60 million through a London initial public offering (IPO) next month.

Half of the proceeds of the offering, which will be made up of new shares, will fund fleet expansion and the other half will strengthen its cash position.

British Airways plans to subscribe for enough shares in the offer to maintain its existing 15% stake in the regional carrier.

Flybe acquired BA Connect, BA’s former regional airline business in 2007.

BA chief executive Willie Walsh said: “We are delighted to participate in the Flybe IPO.

“We are committed to supporting Flybe in its listing and capital raising.”

Flybe chief executive Jim French said: “A listing will assist Flybe in achieving the next stage in its exciting strategy for growth.”