Connect Airways was a consortium formed in December 2018 to acquire the British regional airline

Flybe Flybe (pronounced ), styled as flybe, is a British airline based at Birmingham Airport, England. History The airline traces its history back to Jersey European Airways, which was set up in 1979 following the merger of Intra Airways and Expres ...

, which had put itself up for sale in November 2018 after issuing a profit warning the previous month, The consortium comprised Virgin Atlantic and the Irish wet-lease specialist airline

Stobart Air Stobart Air, legally incorporated as ''Stobart Air Unlimited Company'', was an Irish regional airline headquartered in Dublin. It operated scheduled services under the brands Aer Lingus Regional, BA CityFlyer and KLM Cityhopper on behalf of the ...

. The consortium was founded by

Virgin Atlantic Virgin Atlantic, a trading name of Virgin Atlantic Airways Limited and Virgin Atlantic International Limited, is a British airline with its head office in Crawley, England. The airline was established in 1984 as British Atlantic Airways, and w ...

, Stobart Aviation and Cyrus Capital Partners through its Luxembourg-based vehicle DLP Holdings. Virgin and Stobart each held 30% of the capital with Cyrus holding the remaining 40%. Cyrus Capital had previously worked with

Virgin Group Virgin Group Ltd. is a British multinational venture capital conglomerate founded by Richard Branson and Nik Powell in February 1970. Virgin Group's date of incorporation is listed as 1989 by the Companies House, who class it as a holding c ...

on the launch of its

Virgin America Virgin America Inc. was a low-cost U.S. airline that operated from 2007 until 2018, when it was acquired by Alaska Airlines. The airline primarily focused on operating low-fare service between cities on the West Coast and other major metropoli ...

airline and its subsequent sale to

Alaska Airlines Alaska Airlines is a major American airline headquartered in SeaTac, Washington, within the Seattle metropolitan area. It is the sixth largest airline in North America when measured by fleet size, scheduled passengers carried, and the numb ...

. The purchase of the operating assets of the Flybe Group was completed on 21 February 2019. On 5 March 2020, the consortium was unable to commit further financial support and Flybe entered administration, ceasing all operations. On 18 March 2020, Connect Airways in turn entered administration.

History

On 11 January 2019, Connect Airways made a £2.2 million cash offer to take over the entire share capital of Flybe, subject to shareholder and court approval. The offer also included the acquisition of

shortly before the Flybe takeover. On 15 January 2019, Connect Airways increased its offer by £600,000, and set out improved bridging loan conditions, with £10 million to be released immediately to support Flybe's business, and a further £10 million available. Subsequent funding of £80 million was also confirmed. Flybe Group accepted the £2.8 million offer and noted that its shares had been transferred to a standard listing, effective on 17 January, meaning that shareholder approval for the sale of the group's operating assets, i.e. the airline and the website, would no longer be required. The deadline for the deal to close was 22 February 2019. On 21 February 2019, Flybe Group confirmed that its operating assets, i.e. the airline and the website, had indeed been transferred to Connect Airways, despite a last-minute rival bid. The sale of the parent company, Flybe Group plcnow an empty shell was confirmed by its shareholders at a meeting on 4 March and became effective on 11 March. On 5 July 2019, merger clearance from the

European Commission The European Commission (EC) is the executive of the European Union (EU). It operates as a cabinet government, with 27 members of the Commission (informally known as "Commissioners") headed by a President. It includes an administrative body o ...

was granted, giving Connect Airways full control of the Flybe assets. This was conditional on Connect Airways releasing slot pairs at both Amsterdam–Schiphol and

Paris–Charles de Gaulle Paris Charles de Gaulle Airport (french: Aéroport de Paris-Charles-de-Gaulle, ), also known as Roissy Airport or simply Paris CDG, is the principal airport serving the French capital, Paris ( and its metropolitan area), and the largest intern ...

. In 2020 the consortium would have rebranded Flybe as Virgin Connect and changed its values to align the airline with the Virgin brand. The aim was to create a "fully-fledged UK network carrier" with an enhanced presence at

Heathrow Heathrow Airport (), called ''London Airport'' until 1966 and now known as London Heathrow , is a major international airport in London, England. It is the largest of the six international airports in the London airport system (the others bei ...

and

Manchester Manchester () is a city in Greater Manchester, England. It had a population of 552,000 in 2021. It is bordered by the Cheshire Plain to the south, the Pennines to the north and east, and the neighbouring city of Salford to the west. The t ...

airports. Flybe and Stobart Air would have however retained their own

Air Operator Certificate An air operator's certificate (AOC) is the approval granted by a civil aviation authority (CAA) to an aircraft operator to allow it to use aircraft for commercial purposes. This requires the operator to have personnel, assets, and system in plac ...

s and Stobart Air's franchise/wet lease operations for other airlines would have continued. Virgin Atlantic had previously operated domestic routes from Heathrow under their

Virgin Atlantic Little Red Virgin Atlantic Little Red (also referred to as Virgin Little Red and Little Red) was a short-lived British airline subsidiary owned by Virgin Atlantic. It was created in 2012 as a way to provide competition for aviation giant British Airways ...

subsidiary between 2013 and 2015; these routes were subsequently taken over by Flybe in 2017. , the Virgin Connect website contained some basic information and FAQs about the further plans for the rebranding but would have eventually become the website used to book flights from 2020. The Virgin group also launched a new landing page to avoid confusion with the existing Virgin Connect brand used in Russia for internet and mobile services. In February 2020, the UK government envisaged granting Flybe a £100 million rescue loan, and held talks with the EU Commission to ensure that state aid rules were not broken. In the early morning of 5 March 2020, Flybe filed for administration and ceased all operations with immediate effect after the UK government failed to grant a proposed £100 million ($129 million) loan. Virgin Atlantic stated that Connect Airways could "no longer commit to continued financial support" despite its investment of over £135 million, and placed part of the blame on the negative impact of the

COVID-19 pandemic The COVID-19 pandemic, also known as the coronavirus pandemic, is an ongoing global pandemic of coronavirus disease 2019 (COVID-19) caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). The novel virus was first identif ...

on Flybe's trading. On 18 March 2020, Connect Airways in turn entered administration. On 27 April 2020,

Stobart Group Esken Limited (), formerly Stobart Group Limited, is a British infrastructure, aviation and energy company, with operations in the United Kingdom and Ireland. The company is registered in Guernsey but has its operational head office in Lond ...

bought back Stobart Air and Propius Leasing from Connect Airways administrators

Ernst & Young Ernst & Young Global Limited, trade name EY, is a multinational professional services partnership headquartered in London, England. EY is one of the largest professional services networks in the world. Along with Deloitte, KPMG and Pricewaterh ...

, for an initial payment of £300,000 and deferred consideration that could total £8.25 million.

References

{{Virgin Group Holding companies of the United Kingdom Virgin Group Transport companies established in 2018 2018 establishments in England