Flybe issues ultimatum to shareholders to approve sale

Shareholders told to approve sale to Connect Airways, or they will not receive any money

Flybe has agreed to sell operating assets to Connect Airways for £2.8m. File photograph: Phil Noble/Reuters

Flybe has agreed to sell operating assets to Connect Airways for £2.8m. File photograph: Phil Noble/Reuters

 

Troubled UK regional airline Flybe has issued an ultimatum to its shareholders, saying that if they do not approve its sale, the company will be wound up and they will not receive any money.

Flybe has agreed to sell its operating assets – the airline and website – to Connect Airways, a consortium of Virgin Atlantic, Stobart Air and an investment firm, for £2.8 million (€3.2 million). That money will be consumed in “transaction costs and residual and rundown costs of the company”.

Shareholders do not need to approve this sale, but they have also been asked to vote for the sale of the parent company, for which they will receive 1p a share, valuing it at £2.2 million.

In an announcement on Thursday evening, Flybe said if the sale of the parent company is not approved, “the Flybe directors intend to take steps to wind up the company and shareholders are likely to receive no value for their shares in Flybe”.

Flybe called the 1p offer “disappointingly low” but said it was “ultimately the only proposal capable of immediate execution to enable Flybe and the Flybe subsidiaries to continue to trade as going concerns”.

Flybe will hold a general meeting on March 4th. – Copyright The Financial Times Limited 2018