STOB.L Share News (STOB)

LONDON (Alliance News) - Stobart Group Ltd said Thursday it does not intend to make an offer for budget airline Flybe Group PLC after its latest proposal was rejected by the firm.

Shares in Flybe were 23% lower at 35.90 pence on Thursday, Stobart shares were 1.3% lower at 226.49p.

Flybe shares soared 36% on February 22 when Stobart - an infrastructure and support services firm - confirmed it was considering a bid for Flybe.

On Thursday, however, Stobart said it had been "unable to reach agreement on satisfactory terms" with Flybe. This was after Flybe rejected its latest proposal and Stobart considered it not in the interest of shareholders to increase the bid.

As a result, Stobart will not be making a offer for Flybe.

"Stobart Group and Flybe enjoy a range of shared interests as well as a growing franchise arrangement between the two groups' airlines and it is Stobart Group's intention to continue the collaborative working relationship between both companies," Stobart said in a statement.

Under UK takeover rules, Stobart will be allowed to make another approach only if one of a number of things occur, including if Flybe agrees to a new approach or a third-party makes an offer for Flybe.

When the talks were originally announced in late February, Stobart confirmed it had been reviewing alternative structures for its airline and leasing business in order to consolidate the regional airline sector since October 2017.