Shares in struggling British regional airline Flybe soared as much as 115% after it said it had received an alternative financing offer aimed at keeping it in business.
However, Flybe has already said the new offer is not a viable offer.
The airline operates a number of routes to and from Ireland via Dublin, Cork, Knock and Belfast airports.
Flybe said the new preliminary financing proposal was from Bateleur Capital, Mesa Air Group with support from Stobart Group former boss Andrew Tinkler.
Flybe said the proposal was “highly conditional” and it does not believe it could be workable in the timeframe required to enable Flybe to continue to trade.
The optional financing proposal, which includes other undisclosed institutional shareholders, could look to inject cash into Flybe and replace the current funding.
The offer would also include new debt facilities and potential asset sales, bringing the total new funding to Flybe to about £120m (€138m).
Richard Branson’s Virgin Atlantic, Stobart Group and Cyrus Capital agreed to buy Flybe, Britain’s biggest domestic airline in January, through a joint venture company called Connect Airways for an initial £2.2m.
The deal was later revised to sell the airline’s main trading company Flybe Limited and online operation Flybe.com Ltd to the consortium for £2.8m without needing shareholder backing.
The consortium, which had won the backing of Flybe’s board to buy the airline, had also agreed to pump in as much as £100m to keep the airline afloat, including a committed credit facility of up to £20m.
Flybe yesterday said it had drawn down the first £15m of the facility, adding that it continues to regard the arrangements with the consortium as being the only viable option available to the company.
“The arrangements with Connect Airways preserve the interests of Flybe’s stakeholders, customers, employees, partners and pension members,” it said.
In November, Ryanair was named as a possible beneficiary — though not an outright buyer — from a sale of Flybe; with landing slots in British and Dutch airports seen to be an attraction.
Ryanair has since said it wouldn’t be interested in any large-scale acquisitions but could vie for airport slots when available.
Meanwhile, Air France-KLM’s share price jumped more than 6% after the group reported a 150% rise in annual profit to €409m and said it would tighten links between the two airlines.
-Reuters and Irish Examiner