Flybe deal shows turbulence facing regional airlines

A venture led by Richard Branson’s Virgin Atlantic Airways scooped up Flybe for a penny a share, all but wiping out the value of the British regional carrier hit by dwindling passenger numbers, higher oil prices and uncertainty surrounding Brexit.

Virgin, Cyrus Capital, and Aer-Lingus-regional-operator Stobart Group agreed to purchase Flybe for £2.2m (€2.4m). The deal drove shares of the Exeter-based carrier down as much as 90% to a market value of about £6m, a fraction of its £215m capitalisation on its trading debut on the London Stock Exchange in 2010. Flybe will be combined with Stobart Air and operate under the Virgin Atlantic brand, the new owners said.