Flybe could take-off again ‘smaller than before’ in 2021 after administrators agree rescue deal with former shareholder
- Flybe was responsible for about 40% of all regional UK flights at its height
- Airline travel has been one of the worst-affected sectors by the coronavirus
- Thyme Opco, Virgin Atlantic and Stobart Group did buy Flybe in February 2019
Flybe, the budget airline which fell into administration in March, could be flying again next year after a former shareholder agreed to a rescue package.
An investment firm owned by hedge fund Cyrus Capital called Thyme Opco has purchased Flybe’s remaining assets, including its intellectual property, stock and equipment, and hopes to recommence regional operations early next year.
Thyme Opco did initially take control of the airline in February 2019 in a consortium with Virgin Atlantic and Stobart Group. But it has now reached a deal alone with the administrators, which should see the purple planes taking to the air again.
Despite the airline industry attracting record passenger numbers before the pandemic, Flybe struggled due intense competition, a weaker pound, and Brexit, among other matters
The airline was responsible for about 40 per cent of all regional UK flights and served dozens of airports in the UK and Europe, including Birmingham, Southampton, Manchester and Paris.
A spokesman for the Thyme Opco commented: ‘We are extremely excited about the opportunity to relaunch Flybe.’
‘The airline is not only a well-known UK brand, but it was also the largest regional air carrier in the EU, so while we plan to start off smaller than before, we expect to create valuable airline industry jobs, restore essential regional connectivity in the UK and contribute to the recovery of a vital part of the country’s economy.’
Despite the industry attracting record passenger numbers prior to the coronavirus pandemic, Flybe had struggled for some years due to problems caused by intense competition, a weaker pound, and Brexit, among other matters.
The Exeter-based firm did receive financial assistance from the UK government in January, which allowed them to defer air passenger duty and receive a possible loan.
However, it was sent over the edge when Covid-19 caused passenger numbers to plummet, and 2,400 employees were put at risk of unemployment. It is unclear how many jobs will be rescued under Thyme Opco’s new plans.
EY administrator Simon Edel: ”The restart of this iconic brand will provide a potentially significant boost to aviation jobs, regional connectivity, and local economies’
‘Unfortunately, with the situation that has developed with (coronavirus), an already weak company, I’m afraid, just hasn’t been able to survive,’ transport secretary Grant Shapps said at the time.
Simon Edel, an administrator at EY, said: ‘Today’s announcement, and the upcoming completion of this sale, will be great news to communities around the country that were previously served by Flybe.
‘The restart of this iconic brand, which was once Europe’s largest regional airline, will provide a potentially significant boost to aviation jobs, regional connectivity, and local economies.’
Heathrow saw footfall drop 82 per cent year-on-year in September to 1.2 million passengers
Air travel has been one of the worst affected sectors by the coronavirus. Once-busy airports now see far fewer passengers and planes fly out of them each month as travel restrictions and quarantine rules hinder leisure and business travel.
Heathrow saw footfall drop 82 per cent year-on-year in September to 1.2 million, while Gatwick is operating at about 20 per cent capacity.
The Mail on Sunday revealed last weekend that British Airways will reduce their presence at Gatwick Airport and shift its business to its main hub at Heathrow. Both airports have also announced job cuts to help shore up their finances.
Trade body IATA, the International Air Transport Association, estimated in July that global passenger numbers will not recover to their pre-coronavirus levels until 2024, one year later than it had initially forecast.