The owners of London Southend Airport looked set last night to launch a takeover bid for struggling airline Flybe.
Stobart Group, formed out of the Eddie Stobart haulage firm, is in discussions to buy Flybe. The announcement saw shares in the airline soar by 36 per cent.
At the closing share price of 47p yesterday, Flybe was valued at around £102million.
The Exeter-based business has been blighted by tumbling profits and soaring costs, dragging on its share price.
Flybe shares soared 36% after it was announced Stobart Group, formed out of the Eddie Stobart haulage firm, is in discussions to buy the struggling airline
Flybe said it had not yet been approached by Stobart with an offer and told its investors to err on the side of caution.
According to reports, Flybe would view a takeover deal as opportunistic. ‘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,’ it said. Stobart’s shares rose 2.2 per cent.
Neil Wilson, analyst at ETX Capital, said: ‘Flybe hasn’t exactly been doing well for a long time, so it’s hardly a big surprise that it’s the focus of consolidation. This could be the first of several this year.
‘It’s not exactly a surprise as Stobart and Flybe are close partners.’ The two firms have an agreement which sees Stobart operate flights in Ireland under the Flybe brand.
Stobart now has until March 22 to make a firm offer for Flybe.
Stobart launched in the late 1940s as the Eddie Stobart haulage firm. Its lorries business has since separated from the group but Stobart has a 12.5 per cent stake.
It is largely an infrastructure group but also runs Carlisle Lake District Airport and Irish regional airline Stobart Air. In November Flybe said half-year profits almost halved to £8.4million.