Connect Airways receives approval for Flybe acquisition

Photo: © Leonard Leinroth / IFN

Connect Airways has received approval by the European Commission (EC) to acquire and merge with struggling UK regional airline Flybe and Irish Stobart Air.

This means that the British Limited Company is now able to pursue its Flybe takeover plans, which were first reported in January this year.

Connect Airways is a consortium, in which often cited Virgin Atlantic holds 30%, Stobart Air 30% and New York-based hedge fund management company Cyrus Capital Partners 40%, through its Luxembourgish subsidiary DLP Holdings. Former Virgin Atlantic vice-president Mark Anderson is becoming CEO of Connect Airways.

The airlines stated that this deal, in which Connect Airways pays just 2.8 million GBP in total cash to Flybe’s shareholders, secures the long-term future of the regional airline. Flybe, along with sister company Stobart Air, will soon be integrated into the Virgin brand. However, details of this rebranding have not yet been announced. Both airlines will keep their individual Air Operator Certificates.

Virgin Atlantic CEO Shai Weiss commented that his airline, which currently only offers long-haul flights, will benefit from the existing regional network Connect Airways and Flybe provide.

I’m excited to build on the successful partnership Virgin Atlantic has enjoyed with Flybe – and how we can enhance the experience for our mutual customers, once Connect Airways joins the Virgin family and operates under its new brand.Shai Weiss, CEO of Virgin Atlantic

Exeter-based Flybe is Europe’s largest regional carrier and operates a fleet of more than 70 aircraft, including De Havilland Canada Dash 8 Q400 and Embraer E-Jets on short-haul business and leisure routes throughout the continent. In November last year, the airline confirmed that it is facing profit issues and was on the lookout for a potential buyer following increased fuel expenses, slowing demand and a difficult economic situation caused by Brexit. One week later, it was reported that British long-haul carrier Virgin Atlantic is interested in acquiring Flybe. Both airlines were already partnering by having codeshare agreements for selected flights.