Flybe in talks with rivals about potential sale

Flybe’s stock plunged after a profit warning last month

Regional airline Flybe said on Wednesday it was in talks with potential buyers, as it grapples with higher fuel costs, lower demand and a weak British pound, sending its shares up as much as 44 per cent in early trading.

However, they quickly retreated and were traded fractionally lower in the afternoon session.

Airlines have been looking to consolidate in many markets as a result of rising running costs, largely higher fuel prices, and increased competition from budget carriers. Icelandair agreed to buy rival Wow air last week.

Flybe’s stock plunged after a profit warning last month. The airline, which has 78 aircraft in its fleet, said it was in talks with a number of potential buyers, without giving details.

Flybe said it was also looking at other options, such as further reductions in capacity and costs.

The airline reported a 49 per cent rise in adjusted profit before tax for the six months ended September 30th as cost-cutting measures started to pay off. Flybe said it was developing Brexit contingency plans, including potentially reassigning contracts that could be directly affected. – Reuters