Flybe moves to reasure investors as legal action looms

(Sharecast News) - Troubled UK domestic airline Flybe on Thursday sought to reassure investors as it said it had already received the first £10m of funding as part of its buyout by the Connect Airways consortium as one investors reportedly threatened to block the deal.The consortium comprising Virgin Atlantic, Stobart Group and investment firm Cyrus Capital Partners last week changed its takeover offer after Flybe failed to meet financing conditions for a £20m bridging loan.But the consortium of bidders restructured its takeover in a bid to speed up the deal and offer immediate financial support to Flybe, with a revised loan of up to £20m.The buyers will instead pay £2.8 million to take control of the main trading company Flybe and the online arm Flybe.com in a deal set to complete by February 22. The remaining shell would be bought at 1p a share, or £2.2m. Shareholders would not get a vote on the sale of the trading assets.However, Flybe investor, the asset manager Hosking Partners was said to be considering legal action over the deal, accusing the company's directors of breaching their obligations to investors, Sky news reported.