The rest of The Times article20 Dec 2018 07:04
Flybe’s origins can be traced back to 1979. The company was bought by the late Sir Jack Walker, the steel magnate and Blackburn Rovers owner, in 1983 before floating in 2010. However, since becoming a public company Flybe has struggled to make money sustainably. In its latest profit warning, Flybe said it expected to lose £22 million in the year to the end of March 2019 after losses of £9 million last year and £48 million the year before.
Virgin Atlantic said in a statement yesterday that it “continues to review its options in respect of Flybe including potentially making an offer for Flybe”. Virgin added: “Discussions with Flybe and its management are continuing.”
Virgin Atlantic was founded by Sir Richard Branson to take on British Airways on the Atlantic routes to North America and the Caribbean. After three decades of struggling to establish it as a sustainably profitable independent carrier, Sir Richard sold a 49 per cent stake in 2013 to Delta in the US.
In an attempt to cement Delta’s alliance with Air France-KLM, the European combine agreed to pay £220 million to take a 31 per cent stake in Virgin Atlantic, further diluting the interests of Sir Richard down to 20 per cent. It is against that backdrop that Flybe has become of interest to Virgin and its allies as its airport slots will help them with interconnecting services. Flybe sources have long talked up its presence at slot-constrained Schiphol. At Manchester, Britain’s third busiest airport, it has nearly 20 per cent of take-off and landing rights. At Birmingham, about half the size of Manchester, it has about a third of the slots. At the strategic, but capacity-constrained City airport, Flybe is the second largest operator.
Flybe has said nothing other than to confirm it has been speaking to a number of “strategic operators”.
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