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Virgin Atlantic consortium agrees to buy Flybe

AFP  |  London 

A consortium led by Britain's on Friday said it will buy ailing no-frills for USD 2.8 million.

The group, which includes Stobart and investment firm Cyrus Capital Partners, said in a statement that their joint venture will pay just one pence per share under the deal.

will also purchase Stobart Air, which is Stobart Group's regional and aircraft leasing

"Cyrus, and believe that combining and in a more integrated commercial cooperation with Virgin Atlantic's long-haul operations will create a fully-fledged UK under the brand," they said in the statement.

had put itself up for sale in November after taking a major hit from weak passenger demand, rising fuel costs, a struggling pound and Brexit turmoil.

"The industry is suffering from higher fuel costs, currency fluctuations and significant uncertainties presented by Brexit," said Flybe

"We have been affected by all of these factors which have put pressure on short-term financial performance." She added: "By combining to form a larger, stronger, group, we will be better placed to withstand these pressures." Cyrus will own a controlling 40-per cent stake in the new company, while Virgin and Stobart will take 30 per cent each.

The trio has committed to make a 20 million pound bridge loan available to support Flybe's current operations, while another 80 million pound will be provided to the combined group.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, January 11 2019. 17:00 IST