The takeover of regional airline Flybe by a consortium comprising Virgin Atlantic, Stobart Aviation and Cyrus Capital has been challenged by a leading shareholder.
Hosking Partners, which holds around 18% of Flybe's shares, wrote to the Exeter-based firm on Friday requesting an extraordinary general meeting (EGM). Hosking wants to install Eric Kohn, an experienced aviation executive, to replace Flybe's current chairman Simon Laffin. It has also proposed that Kohn should investigate the sales process that was launched on November 14 last year.
The Flybe board decided to sell the business to the Virgin-led consortium late last year after financial challenges and cash-restrictions imposed by credit card companies forced it to seek a buyer. The deal valued shares at £0.01, a 94% drop from its previous trading level. Institutional and private shareholders have challenged the sale, which did not their require approval due to a change in the airline group's structure.
This latest development places more uncertainty over the future of Flybe, although the new owners have already injected £10m in working capital to ensure the business can continue as a going concern.
Text © The Aviation Oracle