The collapse of British regional airline flybmi over higher fuel prices and Brexit uncertainty has forced stranded passengers across Europe to fend for themselves, without the prospect of help from the UK government.
The airline filed for administration late Saturday, in effect grounding all 17 regional aircraft and shutting operations in 25 European cities.
“It has become impossible for the airline’s shareholders to continue their extensive program of funding into the business, despite investment totalling over £40mn ($52mn) in the last six years,” according to a statement by the carrier, formally known as British Midland Regional Ltd, published on its website.
“The challenges, particularly those created by Brexit, have proven to be insurmountable.”
The decision by the closely held company is likely to add to pressure on Transport Secretary Chris Grayling, already under fire for signing off on a no-deal Brexit ferry contract with a company that had no ships. Just two days ago, the minister agreed to continue to subsidise flybmi’s route between London and Londonderry in Northern Ireland through 2021.
Flybe attracts counter-bid
Meanwhile, Flybe Group Plc said American Airlines-backed Mesa Air Group Inc has launched a counter-bid for its business, leading the stock to more than double in price.
The approach from Phoenix, Arizona-based Mesa and New York private-equity firm Bateleur Capital LLC is “preliminary and highly conditional,” Exeter, England-based short-haul carrier Flybe said in a statement yesterday, without revealing how much the potential offer might be worth.
Flybe shares surged 131% before trading 122% higher at 2.89 pence as of 8:35am in London. A January bid from the Connect Airways consortium of Virgin Atlantic Airways Ltd, Stobart Group Ltd and Cyrus Capital is worth 1 penny a share, or £2.2mn, though includes a £20mn bridge loan and a commitment to £80mn of further funding.
Flybmi filed for administration late on Saturday, in effect grounding all 17 regional aircraft and shutting operations in 25 European cities.
