Flybe’s co-owner, Stobart, links the airline’s financial problems with the ‘delay’ of the EU | Business news


One of Flybe’s three shareholders suggested that the bureaucratic procedures of the EU contributed to the regional airline’s financial problems and the controversial rescue.

Stobart Group used an announcement to the London Stock Exchange to reveal that it was contributing up to £ 9 million under the agreement with the government.

He saw the Connect Airways consortium, which also includes Virgin Atlantic and the Cyrus Capital hedge fund, inject tens of millions of pounds of new capital into Flybe.

In return, ministers and the tax collector have agreed to defer more than £ 100 million in air passenger rights payments while discussions on a potential loan continue.

The rescue declared a “misuse of public funds”

The agreement has found strong opposition from major airlines.

British Airways‘the parent company IAG has submitted a claim for state aid to the EU.

But in his announcement, Stobart said Connect’s recovery plan for Flybe was affected by “legacy problems” and a “delay in receiving control” of the business, as it took the European Commission more than six months to clear its acquisition.

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The statement said: “This resulted in a situation in which a greater injection of funds is required to ensure the continuity of the flight.”

The three shareholders, Stobart said, had invested £ 110 million since Connect’s formation and before the bailout while the airline with losses fought the effects of a weak pound and weak demand.

“The Connect Airways consortium has worked tirelessly with Flybe and the UK government to find solutions that guarantee the airline’s financial viability so that consumers can continue to have confidence in flying with Flybe,” he said.

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Minister defends ‘viable’ Flybe rescue

The government has defended the measure, insisting that its support for Flybe is based on the premise that its national air services between regional airports are a crucial gear in the UK transport network.

A spokesman for Prime Minister Boris Johnson said Wednesday: “The government fully complies with state aid rules and there has been no state aid for Flybe.”

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“Any support provided would be done in strictly commercial terms.”

The government is also reviewing how APD applies to domestic flights and regional transport connectivity in the United Kingdom as a result of Flybe’s problems.

Neither Virgin Atlantic, Cyrus nor the ministers have commented on the details of the rescue package.


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