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3AWM
Posts: 232
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 11:03 am

User001 wrote:
Waterbomber wrote:
Also, DL could take a look at a JFK-BHX flight. There could be enough demand for a daily B757/B767 with BE feed.


I personally don’t see Delta putting a flight into BHX. The press releases issued by the airlines state that buying Flybe is primarily to strengthen LHR and MAN. You are not going to achieve that if you start diluting those catchments by putting in another flight half way between the 2 hubs of MAN/LHR.


The press release just states what the combination will achieve right now - more presence and feed at MAN and LHR - it's not a mission statment to build a hub at MAN or LHR.

There are a lot of statements about connectivity. At the moment VS's bases operate in isolation, there aren't even connecting flights between MAN and LHR, I would expect Flybe to start operation these if they can find the slots.

In the longer term once MAN gets daily services to all of the Delta hubs what is the point of diluting yields by adding more frequencies? As direct flights generally demand a higher price and increase demand at the airport they serve. Why not distribute further TATL flights amongst the other Flybe bases, what is the difference passenger wise between transferring at MAN or BHX or EDI, none, but improves the offer to those customers by offering direct over 1 stop. This is fundamentally the advantage Delta/VS/AF/KLM will get from owning a network. They will be able to feed Delta hubs going one way and CDG/AMS going the other way.
 
Bongodog1964
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 12:39 pm

leghorn wrote:
Bongodog1964 wrote:
It will go to a shareholder vote, 50% + 1 share is the threshold under UK law.


75% needed to pass a special resolution


The offer document states that the minimum threshold is that voters must represent a minimum of 75% of the shares, but a simple majority of the votes in favour is sufficient.

There's an added complication to the deal, it appears that 10% of the Flybe stock was purchased on Friday by Andrew Tinkler the recently deposed CEO of Stobart group, I can't for one minute think he has bought them at above the offer price to in essence make a charitable donation to his former employers !!
 
DobboDobbo
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 12:51 pm

3AWM wrote:
The press release just states what the combination will achieve right now - more presence and feed at MAN and LHR - it's not a mission statment to build a hub at MAN or LHR.


From the press release (my emphasis):

“The Combined Group will offer significant benefits for customers:

* Deliver more choice to customers by linking UK regions and Ireland to Virgin Atlantic’s extensive long-haul network through improved connectivity at Manchester Airport and London Heathrow

* Provide the Combined Group with an enhanced presence at Manchester Airport , London Heathrow Airport, with the potential to grow further in London Southend Airport”


I agree it is not a mission statement to build a hub, but it is clearly intending to make changes (presumably to both the VS and legacy BE networks) to improve and enhance what they already have at LHR and MAN.

Plans can change, but for now anything outside this scope is speculative.
 
3AWM
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 1:17 pm

No need to keep re-posting this. If you only want to discuss this in the context of what it might mean for MAN there is a thread for that.

viewtopic.php?f=3&t=1412019
 
User001
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 1:48 pm

3AWM, I (and no doubt others) will continue to discuss the MAN specific elements on here given it was a specific point given in the official press releases. Therefore it’s on topic and fits into the general discussion, no need to try and usher people away just because you don’t like the points being raised. Regards.
 
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VS4ever
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 2:11 pm

User001 wrote:
3AWM, I (and no doubt others) will continue to discuss the MAN specific elements on here given it was a specific point given in the official press releases. Therefore it’s on topic and fits into the general discussion, no need to try and usher people away just because you don’t like the points being raised. Regards.


Agreed, it’s an integral part of the conversation and an important one at that. The MAN thread would not encompass the rest of the deal which means discussing it here makes more sense (as one of the others)

One question I did ask on the MAN thread, but probably should have asked here is. Is there still a path to preclearance for MAN and how might that play into the overall strategy it would almost make MAN a DUB competitor with IAG having that and VS having MAN, but it went a bit quiet so wasn’t surnif it was still going to happen or not
That feeling when you sit at the end of a runway, brakes are released and the raw power takes over. Now that is a thing of beauty and it never gets old.
 
3AWM
Posts: 232
Joined: Sat Jul 23, 2016 1:01 pm

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 2:27 pm

User001 wrote:
3AWM, I (and no doubt others) will continue to discuss the MAN specific elements on here given it was a specific point given in the official press releases. Therefore it’s on topic and fits into the general discussion, no need to try and usher people away just because you don’t like the points being raised. Regards.


Happy to see points being raised and discussed about MAN here but I don't want to see every post that isn't about MAN being answered by a repost of something a few comments back that adds nothing.
 
DobboDobbo
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 3:03 pm

3AWM wrote:
User001 wrote:
3AWM, I (and no doubt others) will continue to discuss the MAN specific elements on here given it was a specific point given in the official press releases. Therefore it’s on topic and fits into the general discussion, no need to try and usher people away just because you don’t like the points being raised. Regards.


Happy to see points being raised and discussed about MAN here but I don't want to see every post that isn't about MAN being answered by a repost of something a few comments back that adds nothing.


From my perspective I’m trying to manage expectations.

The press release sets out a reasonably well defined set of aspirations and objectives. Based on a number of suggestions and hypotheses on this thread, these objectives don’t appear to have been seen and/or digested and/or understood. Where these hypotheses contradict the press release I’d rather refer back to that than anything else.

I’ve also got no issue with discussions about what may happen further down the line, but it is (in my view) reasonanle to place those in their proper context.

Hope this clarifies and best wishes.
 
3AWM
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Joined: Sat Jul 23, 2016 1:01 pm

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 3:07 pm

No probs, I am just saying we got the message.
 
3AWM
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Joined: Sat Jul 23, 2016 1:01 pm

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 3:15 pm

I kind of agree, I don't expect to see a heap of investment on the regional network just tinkering with the existing routes, part of this is due to the way it is owned but it also says it in the longer press release. https://www.virginatlantic.com/content/ ... -flybe.pdf

I suspect any longer term announcements will be deferred until after the AF/KLM investment is finalised.
 
leghorn
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 3:18 pm

Bongodog1964 wrote:
leghorn wrote:
Bongodog1964 wrote:
It will go to a shareholder vote, 50% + 1 share is the threshold under UK law.


75% needed to pass a special resolution


The offer document states that the minimum threshold is that voters must represent a minimum of 75% of the shares, but a simple majority of the votes in favour is sufficient.

There's an added complication to the deal, it appears that 10% of the Flybe stock was purchased on Friday by Andrew Tinkler the recently deposed CEO of Stobart group, I can't for one minute think he has bought them at above the offer price to in essence make a charitable donation to his former employers !!


It says:
The Scheme will be put to Scheme Shareholders at the Court Meeting and the Flybe General Meeting. In order to become Effective, the Scheme must be approved by a majority in number of the holders of Scheme Shares [b] present and voting[b], either in person or by proxy, representing not less than 75% in value of the Scheme Shares held by such holders. In addition, resolutions to deal with certain ancillary matters must be passed at the Flybe General Meeting to be held immediately after the Court Meeting.

That means 75% of the shares casting a vote must approve the deal for it to be accepted.
 
Bongodog1964
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 3:51 pm

leghorn wrote:
Bongodog1964 wrote:
leghorn wrote:

75% needed to pass a special resolution


The offer document states that the minimum threshold is that voters must represent a minimum of 75% of the shares, but a simple majority of the votes in favour is sufficient.

There's an added complication to the deal, it appears that 10% of the Flybe stock was purchased on Friday by Andrew Tinkler the recently deposed CEO of Stobart group, I can't for one minute think he has bought them at above the offer price to in essence make a charitable donation to his former employers !!


It says:
The Scheme will be put to Scheme Shareholders at the Court Meeting and the Flybe General Meeting. In order to become Effective, the Scheme must be approved by a majority in number of the holders of Scheme Shares [b] present and voting[b], either in person or by proxy, representing not less than 75% in value of the Scheme Shares held by such holders. In addition, resolutions to deal with certain ancillary matters must be passed at the Flybe General Meeting to be held immediately after the Court Meeting.

That means 75% of the shares casting a vote must approve the deal for it to be accepted.


I read that as it clearly says, it has to be approved by a majority of the shareholders voting, and those voting have to represent 75% of the total shareholding.

In regard to the chances of success of the takeover, I would now rate it as very low unless the consortium up their offer substantially. Lots of shares changed hands on Friday, and it appears that about 20% of the total shareholding has changed hands today at around 4p per share, thats 4 x the present buy out offer.
 
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Aisak
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 5:32 pm

DobboDobbo wrote:
* Deliver more choice to customers by linking UK regions and Ireland to Virgin Atlantic’s extensive long-haul network through improved connectivity at Manchester Airport and London Heathrow

* Provide the Combined Group with an enhanced presence at Manchester Airport , London Heathrow Airport, with the potential to grow further in London Southend Airport”[/i]

I agree it is not a mission statement to build a hub, but it is clearly intending to make changes (presumably to both the VS and legacy BE networks) to improve and enhance what they already have at LHR and MAN.


If by "exhanced presence" they mean somewhat similar to "Virgin Atlantic’s extensive long-haul network", I don't expect much or any grownth at MAN :D.

I read extensive as something more than 4 based planes to a handful of destinations. If they are serious about MAN, they should start by moving VS-DL from T2 to T1-T3 to ease connections with Flybe there. Maybe convincing the airport to reshuffle airlines like LHR and LGW did, and get Skyteam (or most) at T1-T3 so they can share facilities like a brand new lounge.
Once this happens and BE codes are replaced by VS, the departure/arrival boards will be full of Virgin flights, then that would be an enhanced presence.
 
azz767
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 6:24 pm

Aisak wrote:
DobboDobbo wrote:
* Deliver more choice to customers by linking UK regions and Ireland to Virgin Atlantic’s extensive long-haul network through improved connectivity at Manchester Airport and London Heathrow

* Provide the Combined Group with an enhanced presence at Manchester Airport , London Heathrow Airport, with the potential to grow further in London Southend Airport”[/i]

I agree it is not a mission statement to build a hub, but it is clearly intending to make changes (presumably to both the VS and legacy BE networks) to improve and enhance what they already have at LHR and MAN.


If by "exhanced presence" they mean somewhat similar to "Virgin Atlantic’s extensive long-haul network", I don't expect much or any grownth at MAN :D.

I read extensive as something more than 4 based planes to a handful of destinations. If they are serious about MAN, they should start by moving VS-DL from T2 to T1-T3 to ease connections with Flybe there. Maybe convincing the airport to reshuffle airlines like LHR and LGW did, and get Skyteam (or most) at T1-T3 so they can share facilities like a brand new lounge.
Once this happens and BE codes are replaced by VS, the departure/arrival boards will be full of Virgin flights, then that would be an enhanced presence.


Why would they move from the shiny new terminal that’s about to be built, and go into something from the 1960’s. Surely it would make more sense to move BE to T2?
 
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Aisak
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Mon Jan 14, 2019 6:36 pm

azz767 wrote:
Why would they move from the shiny new terminal that’s about to be built, and go into something from the 1960’s. Surely it would make more sense to move BE to T2?

Well, I thought T2 was to be just expanded with a new pier, not about to be built. And didn't know T3 was so dreadful.

I just don't know if T2 is (will be) able to handle domestic flights as T3 does. Also, it seems T2 is mostly used by longhaul airlines, does it even has the facilities to board a regional aircraft as the Q400?
 
leghorn
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Tue Jan 15, 2019 9:39 am

So I don't get to vote on this after all. I won't be permitted. Bad news buried on BREXIT vote day.
http://www.cityam.com/271618/budget-air ... proved-bid

The undertaking is being handed over to the purchaser without a vote on divestment.
With no institutional investors in the mix with any decent shareholding what could be characterized quite fairly as daylight robbery has come to pass.
I've learnt a lesson from this. I'll stick with the herd in the larger capitalized publicly quoted companies in future. There institutional investors and private investors objectives usually align.
This could never have happened in a private company or partnership.

I am more heavily invested in another company where the investors don't have as much influence over strategy and distribution of profit as they should. Based on the experience here I will be looking to sell out of that company as soon as the right opportunity presents itself.

I really liked the idea of being invested in a company that doesn't rent-seek, provides a needed service in exchange for reward. So much for my stab at ethical investing.
A company with real worth; a fleet of planes, a recognized brand name, considerable real estate, a booking engine and website, a maintenance facility, slots, a supply of employees most especially Pilots who are in relatively short supply - all that and the best the Board of Directors could do for me was 1 penny per share. Incompetence or Fraud. You decide.

I'll go off and lick my wounds.
 
azz767
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Tue Jan 15, 2019 10:34 am

Aisak wrote:
azz767 wrote:
Why would they move from the shiny new terminal that’s about to be built, and go into something from the 1960’s. Surely it would make more sense to move BE to T2?

Well, I thought T2 was to be just expanded with a new pier, not about to be built. And didn't know T3 was so dreadful.

I just don't know if T2 is (will be) able to handle domestic flights as T3 does. Also, it seems T2 is mostly used by longhaul airlines, does it even has the facilities to board a regional aircraft as the Q400?


T2 is undergoing a mass transformation plan containing 3 new piers and an expanded terminal, which when finished, is going to accommodate the closure of T1 and absorb all the pax from there. Of course it will be able to handle Q400's, they could even go remote and get bussed to the terminal.


T3 isnt dreadful but if you want to add 2 full 744's to mouse land, plus another 744 and some A330's to the US into that terminal you've got no chance. It can barely handle all the RYR on top of what it was designed for. T2 gives VS a major chance to build a hub using a new transfer facility and potential USPBC. Going to T3 would not only be a logistical nightmare but a major backwards step.
 
BrianDromey
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Tue Jan 15, 2019 12:27 pm

Looks like the deal is done! What remains of flyBe is an empty holding company. Sounds like flyBe needed the cash ASAP and was running out of time.

https://www.headforpoints.com/2019/01/1 ... deal-done/

As for MAN T2/T3, at the moment nothing’s been publicly announced, but BA are expected to be an early occupant of T2. Their main route is domestic, so a domestic arrivals channel is implied.
The MAP TP was designed to be flexible and allow stands to accommodate a range of aircraft, mainly A320 size, both bridge and steps boarding. MAN sees a huge array of types, from 30 seater props and ERJs all the way to A380 and everything in between.

As the building is still underway at MAN, any necessary modifications will be relatively easy. Ryanair are keen on T3 due to runway proximity and lack of cul-de-sac, which they believe help turn around times and on-time performance. If BA (let’s assume Aa and IB go too) and BE (and AF/KL) do move out, I would expect T3 to be much improved.
 
leghorn
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Tue Jan 15, 2019 12:49 pm

BrianDromey wrote:
Looks like the deal is done! What remains of flyBe is an empty holding company.

The Squid found a way to get at the contents of the bottle.
 
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Aisak
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Tue Jan 15, 2019 4:43 pm

BrianDromey wrote:
What remains of flyBe is an empty holding company.


It seems Connect Airways (30% Virgin Atlantic, 30% Stobart, 40% Cyrus) is now bidding for 100% of Flybe ltd (the airline) and 100% flybe.com (the e-commerce webpage) both owned by listed Flybe PLC (Flybe group).

Maybe not an empty company, as I assume MRO will still be part of Flybe PLC (flybeas.com says "Flybe group includes an airline and an MRO") and not part of the deal, but it doesn't look good for shareholders. I doubt about "The Flybe Training Academy", as their website says "part of Europe’s most successful regional airline Flybe" and not part of the group.

I sincerely hope this management movement is not seen as "Asset stripping" under shareholders eyes. After all, if the deal is completed as is, Flybe PLC might be a "shell empty company" but with 2,8 Million Pounds in the bank.... and maybe the MRO.
 
Bongodog1964
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Tue Jan 15, 2019 5:15 pm

Aisak wrote:
BrianDromey wrote:
What remains of flyBe is an empty holding company.


It seems Connect Airways (30% Virgin Atlantic, 30% Stobart, 40% Cyrus) is now bidding for 100% of Flybe ltd (the airline) and 100% flybe.com (the e-commerce webpage) both owned by listed Flybe PLC (Flybe group).

Maybe not an empty company, as I assume MRO will still be part of Flybe PLC (flybeas.com says "Flybe group includes an airline and an MRO") and not part of the deal, but it doesn't look good for shareholders. I doubt about "The Flybe Training Academy", as their website says "part of Europe’s most successful regional airline Flybe" and not part of the group.

I sincerely hope this management movement is not seen as "Asset stripping" under shareholders eyes. After all, if the deal is completed as is, Flybe PLC might be a "shell empty company" but with 2,8 Million Pounds in the bank.... and maybe the MRO.


What else can it be seen as ? If it wasn't bad enough that shareholders suddenly saw almost all their investment potentially wiped out last Friday, apparently only 4 days later the situation had worsened to the extent that the board of directors felt the need to sell off the operational companies immediately without recourse to shareholders. Why go to the effort of producing an offer document to supersede it so soon ?

Also what guarantee is there that shareholders will ever see a penny of the £2.8m, under last weeks offer they were due a prescribed payment as the consortium was buying a going concern, now they will only get the residue after Flybe PLC is wound up, the accountants will probably take the lot for their efforts
 
3AWM
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Tue Jan 15, 2019 5:40 pm

Any value left in Flybe would be destroyed as soon as it went into liquidation, it wouldn't be able to sell tickets but it would have a huge liability for future lease payments, wages, sold journeys not completed and other debts.

The airline needs a major injection of capital in order to continue to exist.

When a company public announces that it's looking for buyers it means it's flat broke, not an investment opportunity. Professional investors know this, that is why there are no institutional investors to speak of left. When a company makes an announcement like that it's a signal to cut your losses and get out, any investment is a massive gamble.

Same thing happened with Monarch only Flybe were lucky and found an interested party. They also aren't sitting on a saleable slot portfolio as they just sold their Gatwick slots of a few more weeks in business.

Better luck next time, at least the people who depend on Flybe for their livelihood will get to keep their jobs!
 
leghorn
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Tue Jan 15, 2019 7:46 pm

3AWM wrote:
at least the people who depend on Flybe for their livelihood will get to keep their jobs!

No the won't. Not for long.
 
Bongodog1964
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Tue Jan 15, 2019 9:10 pm

leghorn wrote:
3AWM wrote:
at least the people who depend on Flybe for their livelihood will get to keep their jobs!

No the won't. Not for long.


Exactly - Flybe was up the creek without a paddle, Much of their route network was deemed unprofitable by BA years ago and flogged off, nothing has really changed in that respect, apart from the LCC's being even stronger.

There has been much talk about the advantages of feed to VS, the offer document even mentioned "Virgin Atlantics extensive route network" As they have virtually no network beyond the North Atlantic its not really extensive is it?

They presently only have a very limited network at MAN, so what will they be feeding in to ? forget LHR, slots are either not available or too expensive to operate regional flights.

As to the involvement of Stobart group, a quick search will show that they are embroiled in dispute over their own governance at present, they need to be sure who will be running them next month before investing in a failed airline.
 
UKflyboy
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Jan 17, 2019 9:08 pm

The offer has been increased to £2.8M and the Stock Exchange listing will go from Premium to Standard. This means the deal can go through without ashareholders vote wont be needed and will also speed up the sale process. (Sorry if already mentioned but not read the whole thread yet).

Flybe went all guns blazing after 9/11 putting massive orders in for new aircraft etc. It worked for a while then things changed. They spent millions on advertising but that meant nothing when customers booked flights, turned up to check in only to be told the flight was cancelled because of the flight was barely full and not profitable to fly. That and countless problems with the Q400’s has lead to customers turning away which is why people are reluctant to use them but they do fly routes people rely on.

I am glad VS etc are willing to take the risk, it could work out well. Don’t forget there are routes within Europe that could open up the Virgin Holidays market.

I predict alot of routes cut that wont help feeds for VS but again some routes open up VH opportunities.

There does need to be massive investment in new aircraft which I cannot see happening at the moment.

Virgin Red was barely advertised hence the fail IMO.

I hope it all works!
 
philabos
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Jan 17, 2019 9:19 pm

Just a question.
If BA could not make this work with a vast network, what does VS bring to the table to make a difference?
 
Bhoy
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Jan 17, 2019 9:49 pm

philabos wrote:
Just a question.
If BA could not make this work with a vast network, what does VS bring to the table to make a difference?

I'm not 100% sure BA didn't make it work, but just wanted to concentrate on London.
BE already had their own network when they took on BA Connect's non-LCY based flying, so it's all a bit of a hotch potch, but they were never used for feeding a network (other than their connecting their own flights) as they didn't operate to LHR/LGW, and BA had no other routes at MAN other than London.
 
thegrew
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Jan 17, 2019 11:08 pm

Bhoy wrote:
philabos wrote:
Just a question.
If BA could not make this work with a vast network, what does VS bring to the table to make a difference?

I'm not 100% sure BA didn't make it work, but just wanted to concentrate on London.
BE already had their own network when they took on BA Connect's non-LCY based flying, so it's all a bit of a hotch potch, but they were never used for feeding a network (other than their connecting their own flights) as they didn't operate to LHR/LGW, and BA had no other routes at MAN other than London.
I would also say that much of the BA Connect fleet was comparatively (to the Q400) inefficient jets. ( https://en.m.wikipedia.org/wiki/BA_Connect ). I suspect the Q400 made many of the routes more viable compared to the 145s and 146s.

Sent from my Moto G (5) Plus using Tapatalk
 
Bongodog1964
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Fri Jan 18, 2019 12:10 pm

Bhoy wrote:
philabos wrote:
Just a question.
If BA could not make this work with a vast network, what does VS bring to the table to make a difference?

I'm not 100% sure BA didn't make it work, but just wanted to concentrate on London.
BE already had their own network when they took on BA Connect's non-LCY based flying, so it's all a bit of a hotch potch, but they were never used for feeding a network (other than their connecting their own flights) as they didn't operate to LHR/LGW, and BA had no other routes at MAN other than London.


BA were losing £1 for every £10 of revenue on BA Connect, the business was so unviable that they paid Flybe £130m to take it off their hands. Unsurprisingly the only decent profitable year since for Flybe was 2008 when they had plenty of BA cash left in the bank.

We now have the scenario of a consistently unprofitable airline being bought by a consortium that is 30% owned by another consistently unprofitable airline and 30% owned by a company with a rather inconsistent investment strategy lots of red ink on the balance sheet over the past 5 years, and a share price that has nearly halved over the past 12 months.

It will take a miracle for this to turn out well.
 
UKflyboy
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Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Fri Feb 01, 2019 8:53 pm

Sorry to bump this thread but I’ve been looking at certain things for this to help work.

If there was (to be) a lot more investment from VS and DL/KL/AF there could be alot more to gain for feed to hubs in the above areas. I’m particularly looking at places like PRG and other Eastern European countries. There are obviously feeds already to CDG/AMS by AF/KL but these could also be done by the new Flybe deal that could also add LHR and MAN . There is plenty of flights to China, UAE etc but not much via potential western destination connections.

My main thinking behind this is because obviously BE is mainly UK regional destinations which to me VS etc will want to drop. Are they going to be bothered about JER-GCI or JER-BRS that Blue Islands could carry on? I think there is need to think outside the box here.
 
bmibaby737
Posts: 1641
Joined: Sun Jun 12, 2005 1:07 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Fri Feb 01, 2019 9:51 pm

UKflyboy wrote:
My main thinking behind this is because obviously BE is mainly UK regional destinations which to me VS etc will want to drop. Are they going to be bothered about JER-GCI or JER-BRS that Blue Islands could carry on? I think there is need to think outside the box here.


Virgin failed with Little Red, mostly because of low-loads but in my opinion partly because the economy of scale wasn't that great - four A320s operating on four domestic routes... now these routes can be supported by economies of scale of the whole Flybe operation. Many people are forgetting that it's not simply Virgin taking over Flybe, it's Stobart Air and Cyrus Capital Partners, too. Stobart Air and Cyrus Capital Partners will have a different vision for Flybe than Virgin; so together they need to come up with a positive plan for the airline and I cannot see them wanting to close down profitable parts of the business. Plus, having the airline fly routes from it's core markets such as Southampton, Channel Islands, Birmingham, Belfast etc. will increase brand awareness and increase Virgin Atlantic's long-haul customer base. Passengers commuting between Belfast and Southampton every week for business could then spend their reward points towards a family holiday to Florida on Virgin Atlantic from Manchester and fly BHD-MAN-MCO, for example.

Sure, these sort of flights have not been Virgin Atlantic's focus in the past - but there's nothing stopping them from monetizing on these routes in the future, in addition to the feed to their long haul flights.

That said, I'm not sure how large Virgin's appetite for being a 'franchise' available to airlines like Blue Islands and Eastern Airways would be. At least with Flybe they have control and say in the airline and what it does with the airlines image. That's lost partly when allowing your brand to be used by other airlines as a franchise. It'll be interesting to see how Blue Islands and Eastern Airways are affected by the sale of Flybe. However, Blue Islands has already said that they are prepared to continue with their current operation as an independent business with their own branding again.
 
Bhoy
Posts: 566
Joined: Tue Apr 18, 2006 1:50 pm

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Fri Feb 01, 2019 11:31 pm

bmibaby737 wrote:
Virgin failed with Little Red, mostly because of low-loads but in my opinion partly because the economy of scale wasn't that great - four A320s operating on four domestic routes...

It was only three domestic routes: LHR-ABZ/EDI/MAN. BD had dropped LHR-GLA a year before they BA took them over, so there were no residual slots set aside for that route, although lots of people seem to assume they operated it.


On a side note, I got an e-mail this week saying flybe will be leaving Avios at the end of March (this was sent by Avios), but not setting out how/what it'll be replaced by (As of now, you can't collect Flying Club Miles on BE marketed tickets, so we shall see how that develops...)
 
TC957
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Joined: Wed May 23, 2012 1:12 pm

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 8:08 pm

Flybe announced today that they " could be finished and wound up "at their 4th March AGM if the current rescue plan, the only one submitted, isn't approved.
Yikes ! no pressure then...
 
leghorn
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Joined: Sun Jan 22, 2017 9:13 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 8:15 pm

If that is what it takes to drive away the bandits stealing the company away from the shareholders then so be it.
when the bandits are offering 1p per share then the threat doesn't engender much fear in the shareholders.
Certainly, not for me anyhow.

There is a github which covers everything which has come to light about flybe sale process which can be found at the share forums on lse.co.uk
 
bmibaby737
Posts: 1641
Joined: Sun Jun 12, 2005 1:07 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 8:46 pm

TC957 wrote:
Flybe announced today that they " could be finished and wound up "at their 4th March AGM if the current rescue plan, the only one submitted, isn't approved.
Yikes ! no pressure then...


I believe they're talking about "FLYBE GROUP PLC" which is the group that owns the airline, "Flybe Limited". The airline, "Flybe Limited" will be sold already to Connect Airways by the time of the vote - leaving "Flybe Group PLC" an empty shell of a company. If I understand it all correctly.

https://www.flybe.com/investors/strateg ... le-process
 
bennett123
Posts: 10367
Joined: Sun Aug 15, 2004 12:49 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 8:52 pm

If Flybe Ltd is sold to Connect Airways, will the proceeds be paid to Flybe PLC.

Did the shareholders approve the sale.
 
leghorn
Posts: 1297
Joined: Sun Jan 22, 2017 9:13 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 9:20 pm

The chicanery is to much to go in to here.
Shareholders who are the owners of the company did not get to vote for transfer ALL THE ASSETS of the company to a third party.
The Board of Directors are in the thrall of the Consortium.
The assets of the owners have been transferred to a stranger who happens to be allegedly mates with some of the guys on the board.
The shareholders are trying to arrange the replacement of members of the board but this announcement is an F.U. to the shareholders telling them they are too late and the horse has bolted and they'll wind up the company before the shareholders can gain a majority on the board.
 
bennett123
Posts: 10367
Joined: Sun Aug 15, 2004 12:49 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 9:25 pm

Is this actually legal.
 
leghorn
Posts: 1297
Joined: Sun Jan 22, 2017 9:13 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 9:34 pm

There'd be a perp walk in the US but not in the UK.
 
TC957
Posts: 3921
Joined: Wed May 23, 2012 1:12 pm

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 9:55 pm

leghorn wrote:
The chicanery is to much to go in to here.
Shareholders who are the owners of the company did not get to vote for transfer ALL THE ASSETS of the company to a third party.
The Board of Directors are in the thrall of the Consortium.
The assets of the owners have been transferred to a stranger who happens to be allegedly mates with some of the guys on the board.
The shareholders are trying to arrange the replacement of members of the board but this announcement is an F.U. to the shareholders telling them they are too late and the horse has bolted and they'll wind up the company before the shareholders can gain a majority on the board.

Goodness me - that sounds like the work of a team of " creative accountants " here !
 
DobboDobbo
Posts: 1158
Joined: Thu Mar 03, 2016 1:02 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 10:37 pm

TBH when a business is insolvent or technically insolvent the obligations of the shareholders tend to play second fiddle to holders of debt instruments.

I suspect this deal is on the basis that it protects the creditors, whilst giving the shareholders something (presumably on the basis that in an insolvent winding up of the company the holders of debt would take pence in the pound leaving nothing for the shareholders).

Its unfortunate, but sometimes that's the way it goes.
 
bennett123
Posts: 10367
Joined: Sun Aug 15, 2004 12:49 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 10:53 pm

My understanding is that the board are tasked with acting in the interests of the owners I.e. the Shareholders.
 
DobboDobbo
Posts: 1158
Joined: Thu Mar 03, 2016 1:02 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 11:07 pm

bennett123 wrote:
My understanding is that the board are tasked with acting in the interests of the owners I.e. the Shareholders.


In the ordinary course of things - yes.

However, in an insolvency scenario the directors also owe duties to protect the creditors of that company (this sounds like it is or will shortly be an insolvency scenario).
 
leghorn
Posts: 1297
Joined: Sun Jan 22, 2017 9:13 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 11:15 pm

DobboDobbo wrote:
TBH when a business is insolvent or technically insolvent the obligations of the shareholders tend to play second fiddle to holders of debt instruments.

I suspect this deal is on the basis that it protects the creditors, whilst giving the shareholders something (presumably on the basis that in an insolvent winding up of the company the holders of debt would take pence in the pound leaving nothing for the shareholders).

Its unfortunate, but sometimes that's the way it goes.

A company which is party to the buyout was offering 40 times more per share just a few months ago.
Now they are part of a consortium who appear to have shared notes despite NDAs being in place and buying it at a penny a share.
The Board of Directors couldn't parley the 10 or so million passengers per year in to some some sort of goodwill premium. They couldn't get the intangible assets like a brandname and booking engine in to a price premium. A bunch of monkeys could have done better.

The board of directors' obligations are to the shareholders. The only obligations they have to creditors and society is not to trade recklessly rather than ensuring that the creditors are made whole. Creditors take it upon themselves to ensure they give credit only to customers who can pay their bills.
Their obligations to their employees are only those which are specified by law.

If there was no worth in FlyBE the share price of Stobart would not have increased when the deal to purchase FlyBE was announced.
 
caaardiff
Posts: 205
Joined: Sat Jul 15, 2006 3:14 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Thu Feb 07, 2019 11:28 pm

So if the Connect deal doesn't go ahead, and the company isn't wound up. What next for Flybe? Haven't seen many other alternatives brought up yet. Can it survive as it is?
Sounds like a complete shambles on the run up to this, but the most important question is not what's gone on up to now, it's what's the best thing to do from now?
 
DobboDobbo
Posts: 1158
Joined: Thu Mar 03, 2016 1:02 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Fri Feb 08, 2019 12:05 am

Hi Leghorn

I have no vested interest in this, and I have a huge amount of sympathy for you and your fellow shareholders. I'm sure that to some of you the loss will cause barely a ripple in the personal finances, but I'm equally sure that for some of you the loss will be ruinous. Its a regretful situation, but we are where we are and it is difficult to see another option (some of my thoughts are below).

leghorn wrote:
A company which is party to the buyout was offering 40 times more per share just a few months ago.


If that is so, the directors presumably recommended that the shareholders not accept the offer. I suspect the shareholders agreed, presumably holding out for a higher price and with hindsight this looks like a poor decision. However, BE is/was a public company whose shares were freely traded on an exchange and therefore any shareholder who wanted to sell at that price I'm sure they could have done so.

Either way, that offer is not on the table now (possibly because the BE finances has materially deteriorated since the previous offer and Connect injected £20million to keep the lights on).

leghorn wrote:
Now they are part of a consortium who appear to have shared notes despite NDAs being in place and buying it at a penny a share.


If they did share notes, they were presumably the same notes as I assume BE would have disclosed the same material to each of the individual parties. If they have acted in concert to drive the price down that is one thing, but it seems that BE is in serious financial trouble, in which case 1p per share doesn't feel like a disaster for a business that has been borrowing against its assets and needed a capital injection to keep operating.

leghorn wrote:
The Board of Directors couldn't parley the 10 or so million passengers per year in to some some sort of goodwill premium. They couldn't get the intangible assets like a brandname and booking engine in to a price premium. A bunch of monkeys could have done better.


Perhaps they could have done better, perhaps not. Of course the plan is to use the VS brand and presumably the booking system also.

leghorn wrote:
The board of directors' obligations are to the shareholders. The only obligations they have to creditors and society is not to trade recklessly rather than ensuring that the creditors are made whole. Creditors take it upon themselves to ensure they give credit only to customers who can pay their bills.
Their obligations to their employees are only those which are specified by law.


Like it or not, the directors of an insolvent company do have duties to creditors.

Of course, even if the directors put the company into administration, the secured creditors would get paid their dues before the shareholders, and if the company is actually insolvent the shareholders would get nothing in that scenario. I suspect that the £20million advanced by connect is secured and entitles them to appoint an administrator who will presumably allow them to cherry pick the bits they want.

leghorn wrote:
If there was no worth in FlyBE the share price of Stobart would not have increased when the deal to purchase FlyBE was announced.


Share prices are based on perception, speculation, hopes and fears.

I don't think it is indicative of the underlying merits of a particular transaction, just the market's perception at a given moment in time (which was that the price was lower than expected, apparently because BE was teetering on the brink)
 
DobboDobbo
Posts: 1158
Joined: Thu Mar 03, 2016 1:02 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Fri Feb 08, 2019 12:13 am

caaardiff wrote:
So if the Connect deal doesn't go ahead, and the company isn't wound up. What next for Flybe? Haven't seen many other alternatives brought up yet. Can it survive as it is?
Sounds like a complete shambles on the run up to this, but the most important question is not what's gone on up to now, it's what's the best thing to do from now?


They needed a £20 million injection from Connect to keep operating, the credit card companies were withholding funds, so it is likely that the company will collapse absent the deal going through.

It sounds like the shareholders are unhappy with the directors handling of this, but I don't think there is anything that can be done to stop the transaction and I don't think preventing it would help the shareholders at all as it sounds like BE is on its last legs and there is no money (therefore the secured creditors would get theri due with the shareholders at the back of the queue).
 
leghorn
Posts: 1297
Joined: Sun Jan 22, 2017 9:13 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Fri Feb 08, 2019 9:37 am

I'm going to be voting No to the offer so that hopefully we can get the new director in and he can uncover wrong-doing before the current Directors can wind up the company to cover their tracks.
I have come to terms with a 100% write-off and I'm looking to see in coming days if the major shareholders liquidate or hold their shareholdings which are now at petty cash type levels for them.
That will determine what happens to FlyBE.
By middle of next week it should be obvious what becomes of the company and if the trading assets of the company have to be reclaimed from the interloper and the airline shut down then so be it.

The Directors of an insolvent company have no obligations to their Creditors beyond not trading recklessly reducing once it has become clear the company is insolvent. At that point in time the Creditors stand in line and get what they are entitled to recover from the carcass of the company and the shareholders stand in line behind the creditors to get the scraps.
There is no obligation to make creditors whole or to ensure the continued employment of the employees at the expense of other stakeholders of which the shareholders are one.
Last edited by leghorn on Fri Feb 08, 2019 9:46 am, edited 1 time in total.
 
leghorn
Posts: 1297
Joined: Sun Jan 22, 2017 9:13 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Fri Feb 08, 2019 9:46 am

DobboDobbo wrote:
Hi Leghorn

I have no vested interest in this, and I have a huge amount of sympathy for you and your fellow shareholders. I'm sure that to some of you the loss will cause barely a ripple in the personal finances, but I'm equally sure that for some of you the loss will be ruinous. Its a regretful situation, but we are where we are and it is difficult to see another option (some of my thoughts are below).

leghorn wrote:
A company which is party to the buyout was offering 40 times more per share just a few months ago.


If that is so, the directors presumably recommended that the shareholders not accept the offer. I suspect the shareholders agreed, presumably holding out for a higher price and with hindsight this looks like a poor decision. However, BE is/was a public company whose shares were freely traded on an exchange and therefore any shareholder who wanted to sell at that price I'm sure they could have done so.

Either way, that offer is not on the table now (possibly because the BE finances has materially deteriorated since the previous offer and Connect injected £20million to keep the lights on).

leghorn wrote:
Now they are part of a consortium who appear to have shared notes despite NDAs being in place and buying it at a penny a share.


If they did share notes, they were presumably the same notes as I assume BE would have disclosed the same material to each of the individual parties. If they have acted in concert to drive the price down that is one thing, but it seems that BE is in serious financial trouble, in which case 1p per share doesn't feel like a disaster for a business that has been borrowing against its assets and needed a capital injection to keep operating.

leghorn wrote:
The Board of Directors couldn't parley the 10 or so million passengers per year in to some some sort of goodwill premium. They couldn't get the intangible assets like a brandname and booking engine in to a price premium. A bunch of monkeys could have done better.


Perhaps they could have done better, perhaps not. Of course the plan is to use the VS brand and presumably the booking system also.

leghorn wrote:
The board of directors' obligations are to the shareholders. The only obligations they have to creditors and society is not to trade recklessly rather than ensuring that the creditors are made whole. Creditors take it upon themselves to ensure they give credit only to customers who can pay their bills.
Their obligations to their employees are only those which are specified by law.


Like it or not, the directors of an insolvent company do have duties to creditors.

Of course, even if the directors put the company into administration, the secured creditors would get paid their dues before the shareholders, and if the company is actually insolvent the shareholders would get nothing in that scenario. I suspect that the £20million advanced by connect is secured and entitles them to appoint an administrator who will presumably allow them to cherry pick the bits they want.

leghorn wrote:
If there was no worth in FlyBE the share price of Stobart would not have increased when the deal to purchase FlyBE was announced.


Share prices are based on perception, speculation, hopes and fears.

I don't think it is indicative of the underlying merits of a particular transaction, just the market's perception at a given moment in time (which was that the price was lower than expected, apparently because BE was teetering on the brink)

Your post is very speculative. I have given a link on where you can find further factual information on the train of events and behaviour of various actors if you are interested. Follow that. I'm beyond the point that you currently are at. I'm beyond surmising. I'm beyond anger. The game is in play. I've got my votes to cast and facing a total loss I will do what I can to prevent the interloper from benefiting from their actions.
 
bennett123
Posts: 10367
Joined: Sun Aug 15, 2004 12:49 am

Re: Updated: BE being bought for £2.2m by a consortium including VS, Stobart Group and Cyrus Capital

Fri Feb 08, 2019 9:56 am

Which link was that?.
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