The Exeter-based regional airline Flybe is being bought for £2.2m by a consortium which includes Virgin Atlantic, the Stobart Group and the venture capital company Cyrus. The move comes after Flybe issued a profits warning in October. Flybe will operate under the Virgin brand name and the consortium, known as Connect Airways, will initially lend it £20m to stabilise its current operations. A further £80m will be invested at a later date. Connect will also buy the Stobart Group’s regional airline and aircraft leasing business.
Flybe CEO, Christine Ourmières-Widener, said the airline industry has suffered from higher fuel costs, exchange rate fluctuations plus “significant uncertainties” caused by Brexit. “We have been affected by all of these factors which have put pressure on short-term financial performance.”
Stobart Group CEO, Warwick Brady, explained the deal would provide an opportunity to get more passengers to fly from Southend Airport, which it owns.
The new consortium said it intends to “create a fully-fledged UK network carrier deal” marking a return to domestic flights for Virgin which abandoned its Little Red airline venture in 2014.