Connect Airways
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Company type | Private limited company[1] |
---|---|
Industry | Aviation |
Founded | 18 December 2018[1] |
Founders | Virgin Atlantic Stobart Aviation |
Defunct | 10 March 2020 |
Fate | Under administration |
Headquarters | Exeter Airport,Devon, England |
Key people | Mark Anderson, CEO |
Products | Airlines |
Owners |
|
Subsidiaries | Flybe |
Website | connect-airways |
Connect Airwayswas a consortium formed in December 2018[1]to acquire the British regional airlineFlybe,[2]which had put itself up for sale in November 2018 after issuing a profit warning the previous month,[3]The consortium comprised Virgin Atlantic and the Irish wet-lease specialist airlineStobart Air.[2]
The consortium was founded byVirgin Atlantic,Stobart Aviationand Cyrus Capital Partners through its Luxembourg-based vehicle DLP Holdings.[2]Virgin and Stobart each held 30% of the capital with Cyrus holding the remaining 40%.[4]Cyrus Capital had previously worked withVirgin Groupon the launch of itsVirgin Americaairline and its subsequent sale toAlaska Airlines.[5]
The purchase of the operating assets of the Flybe Group was completed on 21 February 2019.[6]
On 5 March 2020, the consortium was unable to commit further financial support and Flybe entered administration, ceasing all operations.[7]On 10 March 2020,[8]Connect Airways in turn entered administration.[9]
History
[edit]On 11 January 2019, Connect Airways made a £2.2 million cash offer to take over the entire share capital of Flybe, subject to shareholder and court approval. The offer also included the acquisition ofStobart Airshortly before the Flybe takeover.[2]
On 15 January 2019, Connect Airways increased its offer by £600,000, and set out improved bridging loan conditions, with £10 million to be released immediately to support Flybe's business, and a further £10 million available. Subsequent funding of £80 million was also confirmed. Flybe Group accepted the £2.8 million offer and noted that its shares had been transferred to a standard listing, effective on 17 January, meaning that shareholder approval for the sale of the group's operating assets, i.e. the airline and the website, would no longer be required.[10]The deadline for the deal to close was 22 February 2019.[11]
On 21 February 2019, Flybe Group confirmed that its operating assets, i.e. the airline and the website, had indeed been transferred to Connect Airways, despite a last-minute rival bid.[6]The sale of the parent company, Flybe Group plc – now an empty shell – was confirmed by its shareholders at a meeting on 4 March[12]and became effective on 11 March.[13]
On 5 July 2019, merger clearance from theEuropean Commissionwas granted, giving Connect Airways full control of the Flybe assets. This was conditional on Connect Airways releasing slot pairs at bothAmsterdam–SchipholandParis–Charles de Gaulle.[14]
In 2020 the consortium would have rebranded Flybe as Virgin Connect and changed its values to align the airline with the Virgin brand.[15]The aim was to create a "fully-fledged UK network carrier" with an enhanced presence atHeathrowandManchesterairports.[16]Flybe and Stobart Air would have however retained their ownAir Operator Certificates[5]and Stobart Air's franchise/wet lease operations for other airlines would have continued.[16]Virgin Atlantic had previously operated domestic routes from Heathrow under theirVirgin Atlantic Little Redsubsidiary between 2013 and 2015; these routes were subsequently taken over by Flybe in 2017.[17][18]
As of January 2020[update],the Virgin Connect website[19]contained some basic information and FAQs about the further plans for the rebranding but would have eventually become the website used to book flights from 2020. The Virgin group also launched a new landing page[20]to avoid confusion with the existingVirgin Connect brandused in Russia for internet and mobile services.[21]
In February 2020, the UK government envisaged granting Flybe a £100 million rescue loan, and held talks with the EU Commission to ensure that state aid rules were not broken.[22]
In the early morning of 5 March 2020, Flybe filed for administration and ceased all operations with immediate effect after the UK government failed to grant a proposed £100 million ($129 million) loan.[7]Virgin Atlantic stated that Connect Airways could "no longer commit to continued financial support" despite its investment of over £135 million, and placed part of the blame on the negative impact of theCOVID-19 pandemicon Flybe's trading.[23]
On 10 March 2020, Connect Airways in turn entered administration.[8]
On 27 April 2020,Stobart Groupbought back Stobart Air and Propius Leasing from Connect Airways administratorsErnst & Young,for an initial payment of £300,000 and deferred consideration that could total £8.25 million.[24]
References
[edit]- ^abc"Connect Airways Limited – Overview (free company information from Companies House)".beta panieshouse.gov.uk.Retrieved11 January2019.
- ^abcdeKaminski-Morrow, David (11 January 2019)."Virgin Atlantic and Stobart link up to take over Flybe".Flightglobal.
- ^"Flybe up for sale after profit warning".BBC News.14 November 2018.
- ^Flybe to Become Virgin ConnectAirliner WorldDecember 2019
- ^abDyson, Molly."Virgin Atlantic and Stobart agree Flybe take-over".buyingbusinesstravel.Archived fromthe originalon 2019-01-11.Retrieved2019-01-11.
- ^abWarrington, James (21 February 2019)."Flybe completes sale to Virgin-led consortium".cityam.
- ^abAlfred Chua (6 March 2020)."Beleaguered Flybe ceases operations".Flightglobal.
- ^ab"EY Connect Airways limited | EY UK".ey.Retrieved2023-04-16.
- ^"Stobart Air parent Connect Airways in administration".ch-aviation.18 March 2020.
- ^Gallagher, Rosemary (15 January 2019)."Flybe-Connect Airways agreement reached on £2.8m deal".businessInsider.
- ^Reals, Kerry."Connect Airways raises takeover offer for Flybe".atwonline.
- ^"Shareholders Approve Connect Airways Acquisition".otp.investis.Flybe Group plc.[permanent dead link]
- ^"Flybe sale to Virgin-led consortium granted court approval".11 March 2019.
- ^"EU clears Virgin's buy of UK airline Flybe subject to release of slots".5 July 2019. Archived fromthe originalon 5 July 2019.Retrieved5 July2019.
- ^Harper, Lewis (15 October 2019)."Flybe to be rebranded as 'Virgin Connect'".Flightglobal.
- ^ab"Virgin Atlantic and Stobart offered to buy UK regional carrier Flybe".Financial Times.11 January 2019.
- ^"Flybe: Cash-strapped airline rescued by Virgin-led consortium".The Independent.11 January 2019.Retrieved16 January2019.
- ^"Flybe's Scottish flights take off from Heathrow".The Scotsman.31 March 2017.Retrieved16 January2019.
- ^"Welcome to Virgin Connect".Archived fromthe originalon 2019-12-28.Retrieved2022-06-30.
- ^"Our Companies | Virgin".Virgin.Retrieved2020-12-17.
- ^"Virgin Connect".Virgin.24 October 2019.Retrieved2019-11-13.
Looking for internet, fixed line and mobile services in Russia? Visit virginconnect.ru. In 2020 Flybe will become Virgin Connect, your new go-to name in regional flying. [...] Visit virginconnect.co.uk.
- ^Jack, Simon (10 February 2020)."Government considers ownership stake in Flybe".BBC News.Retrieved11 February2020.
- ^Kaminski-Morrow, David (6 March 2020)."Coronavirus dealt fatal blow to embattled Flybe: shareholder".Flight Global.
- ^"Stobart Group confirms purchase of Dublin-based Stobart Air for €344,000".independent.27 April 2020.