Cash-strapped Flybe to be sold to a consortium including Stobart Group and Virgin Atlantic Airways, will be rebranded

Flybe has announced it is being sold to a consortium involving Virgin Atlantic Airways.

Virgin Atlantic has a 30 percent interest in the consortium along with the Stobart Group. Stobart Air already operates flights under the Flybe brand.

This will be the end of the Flybe brand. The airline will be rebranded under the Virgin Atlantic brand.

Cyrus Capital Partners, a hedge fund, will control the remaining 40 percent share the consortium called Connect Airways.

Flybe issued this formal statement:

RECOMMENDED CASH OFFER for FLYBE GROUP PLC by CONNECT AIRWAYS LIMITED
(a company jointly-owned by DLP Holdings S.à. r.l., Stobart Aviation Limited and Virgin Travel Group Limited, a wholly-owned subsidiary of Virgin Atlantic Limited)

Summary

Following the announcement on November 14, 2018 and the launch of the Formal Sale Process with respect to Flybe, the Boards of Flybe and Connect Airways announce that they have reached agreement on the terms of a recommended cash offer for Flybe by Connect Airways pursuant to which Connect Airways will acquire the entire issued and to be issued share capital of Flybe.
Under the terms of the Acquisition, Flybe Shareholders will be entitled to receive:
one (1) pence in cash for each Flybe Share

which values the entire issued and to be issued share capital of Flybe at approximately £2.2 million on the basis of the fully diluted share capital of 216,656,776 Flybe Shares.
Cyrus, Stobart Group and Virgin Atlantic have engaged with Flybe in a collaborative due diligence process since the commencement of the Formal Sale Process, and have formulated the Offer Price after careful review of the due diligence information, the capital needs of Flybe, the challenging trading environment and prevailing market conditions.
Concurrently with announcing the Acquisition, Cyrus, Stobart Group and Virgin Atlantic have committed to make available a £20 million bridge loan facility to support Flybe’s ongoing working capital and operational requirements.
In addition, following completion of the Acquisition, Cyrus, Stobart Group and Virgin Atlantic are intending to provide up to £80 million of further funding to the Combined Group to invest in its business and support its growth, as well as a contribution of Stobart Air.
It is intended that the Acquisition will be effected by means of a Court-sanctioned scheme of arrangement between Flybe and the Scheme Shareholders under Part 26 of the Companies Act.

The Acquisition is subject to a number of Conditions and further terms, including the approval of the Scheme by the Scheme Shareholders by the requisite majorities and the sanctioning of the Scheme by the Court. The Conditions are set out in full in Part A of Appendix 1 to this Announcement.
Connect Airways

Connect Airways is a joint venture company the share capital of which is owned 40% by DLP Holdings, S.à. r.l., a company wholly-owned by funds managed by Cyrus, 30% by Stobart Aviation, a wholly-owned subsidiary of Stobart Group, and 30% by Virgin Travel Group Limited, a wholly-owned subsidiary of Virgin Atlantic, the holding company of Virgin Atlantic Airways Limited and Virgin Holidays Limited.
It is also expected that, immediately prior to completion of the Acquisition, Connect Airways will acquire Stobart Air, Stobart Group’s regional airline and aircraft leasing business. The combined group is expected to bring benefits to customers, suppliers and employees, providing stability in a tough trading environment.
Combined Group
- Cyrus, Stobart Group and Virgin Atlantic believe that combining Flybe and Stobart Air in a more integrated commercial cooperation with Virgin Atlantic’s long-haul operations will create a fully-fledged UK network carrier under the Virgin Atlantic brand, alongside Stobart Air’s wet lease operations and aircraft leasing business which will continue to operate as it does today.
- Such a combination would be a compelling proposition with a comprehensive regional network in the UK and Ireland coupled with an enhanced European footprint, providing greater choice and connectivity for customers to travel to destinations all over the world.
- The Acquisition will enable Flybe to benefit from committed strategic investment partners in terms of Cyrus, Stobart Group and Virgin Atlantic (through Connect Airways) and from an enhanced presence at London Heathrow Airport and Manchester Airport with potential to grow further in London Southend Airport.
- The Acquisition and combination with franchise airline, Stobart Air, will provide the Combined Group with an opportunity to increase passenger numbers at London Southend Airport, accelerating its growth for UK and European air travel.
  Recommendation and support for the offer
- The Flybe Board, who have been advised by Evercore (who are providing independent financial advice to the Flybe Board for the purposes of Rule 3 of the Code) as to the financial terms of the Acquisition, considers the terms of the Acquisition to be fair and reasonable. In providing its financial advice to the Flybe Directors, Evercore has taken into account the commercial assessments of the Flybe Directors.
- Accordingly, the Flybe Directors believe that the terms of the Acquisition are in the best interests of Flybe Shareholders as a whole and unanimously recommend that Flybe Shareholders vote in favour of the resolutions to be proposed at the Court Meeting and the Flybe General Meeting (or, in the event that the Acquisition is implemented by way of a Takeover Offer, to accept or procure the acceptance of such Takeover Offer).

This revised 2018 livery will be very short-lived (just one aircraft):

Virgin Atlantic issued this statement:

The Boards of Flybe and Connect Airways, a company bringing together Virgin Atlantic Limited, Stobart Group and Cyrus Capital, are pleased to announce that they have reached agreement on the terms of a recommended cash offer for Flybe. Following which Connect Airways will acquire the entire issued, and to be issued, share capital of Flybe. Stobart Group will contribute Stobart Air and Propius, Stobart’s aircraft leasing business into Connect Airways.

Concurrently with announcing the Acquisition, Cyrus, Stobart Group and Virgin Atlantic have committed to make available a £20 million bridge loan facility to support Flybe’s ongoing working capital and operational requirements.

In addition, following completion of the Acquisition, Cyrus, Stobart Group and Virgin Atlantic are intending to provide up to £80 million of further funding to the Combined Group to invest in its business and support its growth, as well as a contribution of Stobart Air.

Flybe will continue to serve customers and communities across the UK and Ireland. In due course Flybe will be rebranded to Virgin Atlantic.

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 a strong foundation to secure the long-term future of Flybe, its customers and its people by leveraging the combined commercial, operational and functional expertise and scale of Virgin Atlantic and Stobart Group
Utilise the strength of the Virgin Atlantic brand, and the offer of an enhanced customer experience in keeping with Virgin Atlantic’s heritage
Provide the Combined Group with an enhanced presence at Manchester Airport , London Heathrow Airport, with the potential to grow further in London Southend Airport

The Combined Group intends for Flybe to continue as an independent operating carrier with a separate UK Air Operator Certificate (AOC) under the Virgin Atlantic brand. Stobart Air is intended to continue under a separate Irish AOC.

The Combined Group will operate independently to Virgin Atlantic under one management team, owned 40% by Cyrus Capital Partners, 30% by Stobart Aviation, a wholly owned subsidiary of Stobart Group, and 30% by Virgin Atlantic Limited, the holding company of Virgin Atlantic Airways and Virgin Holidays.

Christine Ourmieres-Widener, Flybe’s CEO said:

“Flybe plays a vital role in the UK’s transport infrastructure with a UK regional network which uniquely positions it to benefit from growing demands from long haul carriers for passenger feeder traffic. We have successfully implemented a clear strategy in recent years focused on tighter fleet management, improving revenue per seat and increasing load factors. The pursuit of operational excellence has reduced maintenance times and increased efficiencies and customer satisfaction.

“However, the industry is suffering from higher fuel costs, currency fluctuations and significant uncertainties presented by Brexit. We have been affected by all of these factors which has put pressure on short-term financial performance. At the same time, Flybe suffered from a number of legacy issues that are being addressed but are still adversely affecting cashflows.

“By combining to form a larger, stronger, group, we will be better placed to withstand these pressures. We aim to provide an even better service to our customers and secure the future for our people.”

Shai Weiss, CEO of Virgin Atlantic said:

“The Virgin Atlantic brand is built on the foundation of putting customers at the heart of everything we do, providing them with the choice they deserve and a travel experience they love. All possible because of our amazing people.

“We are pleased to have this opportunity to partner with Stobart Group and Cyrus Capital to bring Virgin Atlantic service excellence to Flybe’s customers. Together, we can provide greater connectivity to our extensive long haul network and that of our joint venture partners Delta Air Lines, at Manchester Airport and London Heathrow. In the near future, this will only increase, through our expanded joint venture partnership with Air France-KLM.”

Warwick Brady, CEO of Stobart Group said:

“The Board of Stobart Group believes that bringing Stobart Air together with Flybe and partnering with Virgin Atlantic and Cyrus Capital is the best way for us to play an active role in regional airline consolidation.

“The combined entity will be a powerful combination with sufficient scale to compete effectively in the UK and European airline markets. It will allow us to continue to work with Flybe and provides an excellent opportunity to continue to grow passenger numbers at London Southend Airport.”

Lucien Farrell, Partner of Cyrus said:

“We are delighted to be working once again with the Virgin Group following our successful partnership in the launch and eventual sale of Virgin America to Alaska Airlines. We believe Flybe’s strong market position and high quality management together with Virgin Atlantic’s dedication to the best customer experience and Stobart Group’s expertise in regional flying will produce a worldclass airline.

Hawaiian Airlines carries a record 11.8 million passengers in 2018

Hawaiian Airlines, Inc., a subsidiary of Hawaiian Holdings, Inc.has announced its system-wide traffic statistics for the month, quarter, and full year ended December 31, 2018.

Hawaiian welcomed a record 11,840,178 guests in 2018, a 2.9 percent increase over the previous year. The record number of passengers in 2018 marks 14 straight years of growth as Hawaiian continues to expand its network and fleet, providing travelers with more options to fly to, from, and within the Hawaiian Islands than any other carrier.

Hawaiian took delivery of nine A321neo aircraft (top) in 2018, bringing the total size of its A321neo fleet to 11 aircraft. The A321neo will help the airline build upon its already strong U.S. West Coast presence, including new daily nonstop service to Maui’s Kahului Airport from Portland, Sacramento and San Diego international airports, as well as to Honolulu’s Daniel K. Inouye International Airport from Long Beach.

The airline will also begin new five-times-a-week nonstop service to Honolulu from Boston’s Logan International Airport on April 4.

Top Copyright Photo: Hawaiian Airlines Airbus A321-271N WL N212HA (msn 8129) LAX (Michael B. Ing). Image: 943866.

Hawaiian Airlines aircraft slide show:

Lufthansa Group becomes the largest airline group in Europe with 142 million passengers in 2018

Lufthansa Group has made this announcement for its traffic figures for 2018:

In 2018, the airlines of the Lufthansa Group carried a total of 142 million passengers, setting a new passenger record. With more than 1.2 million flights and a seat load factor of 81.4 percent, the aircraft load factor was higher than ever before.

The growth drivers for the network airlines were the Zurich hub and the Munich and Vienna hubs, with passenger growth of 9.5 percent, 9.3 percent and 8.5 percent respectively. The number of passengers at the Frankfurt hub grew by 4.7 percent in 2018. Eurowings also contributed to the Lufthansa Group’s new passenger record in 2018 with growth of 18 percent.

In December, the freight capacity was 4.7 per cent higher than in the previous year and the tonne-kilometres sold 0.4 per cent higher. This results in a payload factor of 66.1 percent, which is 2.8 percentage points lower. In 2018, total freight capacity was 4.3 percent higher than in the previous year. At the same time, sales increased by 0.8 percent in this period. At 66.4 percent, the load factor was 2.3 percentage points lower than in the previous year.

In December 2018, the airlines of the Lufthansa Group welcomed around 10 million passengers on board their aircraft. This corresponds to an increase of 6.9 percent over the same month last year. The number of seat kilometers offered was 11 percent up on the previous year, while sales increased by 10.6 percent. This results in a seat load factor of 78.5 percent, 0.3 percentage points lower than in December 2017.

Network Airlines

The network airlines Lufthansa, Swiss and Austrian Airlines carried a total of some 7.3 million passengers in December, 5.8 percent more than in the same month last year. The number of seat-kilometers offered in December was 9.2 percent up on the same month last year. Sales in seat-kilometers rose by 9.1 percent in the same period. The seat load factor fell by 0.1 percentage points to 78.7 percent.

In total, the network airlines carried around 104 million passengers last year, 7.4 percent more than in the same period last year. The seat load factor for network airlines rose by 0.4 percentage points to 81.5 percent during this period.

Eurowings Group

In point-to-point traffic, the Lufthansa Group carried 2.6 million passengers with the airlines Eurowings (including Germanwings) and Brussels Airlines in December, of which around 2.3 million on short-haul flights and 294,000 on long-haul flights.

This represents an increase of 9.9 percent over the previous year. The 19.5 percent increase in the number of flights on offer in December was offset by a 17.5 per cent increase in sales. At 78 percent, the seat load factor was 1.4 percentage points lower than in the same month last year.

On short-haul routes, the number of seat-kilometers offered was increased by 18 percent in December, while the number of seat-kilometers sold rose by 13.9 percent over the same period. At 74.3 percent, the seat load factor was 2.6 percentage points lower than in the same month last year. On long-haul routes, the seat load factor rose by 0.3 percentage points to 83.1 percent over the same period. The 21.6 percent increase in capacity was offset by a 22.1 percent increase in sales.

In 2018, the Eurowings Group carried a total of around 38.5 million passengers, 18 percent more than in the previous year. At 81.3 percent, the seat load factor during this period was 1.4 percentage points higher than in the previous year.

Embraer and Boeing welcome Brazilian Government approval of strategic partnership

Embraer and Boeing have welcomed approval by the Government of Brazil of the strategic partnership that will position both companies to accelerate growth in global aerospace markets.

The government’s approval comes after the two companies last month approved terms for the joint venture that will be made up of the commercial aircraft and services operations of Embraer. Boeing will hold an 80 percent ownership stake in the new company and Embraer will hold the remaining 20 percent.

The companies have also agreed to the terms of another joint venture to promote and develop new markets for the multi-mission medium airlift KC-390. Under the terms of this proposed partnership, Embraer will own a 51 percent stake in the joint venture, with Boeing owning the remaining 49 percent.

Once Embraer’s Board of Directors ratifies its prior approval, the two companies will then execute definitive transaction documents. The closing of the transaction will be subject to shareholder and regulatory approvals and customary closing conditions. Assuming the approvals are received in a timely manner, the transaction is intended to close by the end of 2019.

Photo: Embraer.

Air France considers the future of Joon

Air France has made this announcement:

A project for Joon’s future

After much discussion with employees and customers alike, and in consultation with the unions, Air France has decided to launch a project studying the future of the Joon brand and the integration of Joon employees and aircraft into Air France.

Despite the many positive impacts of Joon, in particular the invaluable contribution of the teams at Joon who launched the company and worked with passion and dedication, the brand was difficult to understand from the outset for customers, for employees, for markets and for investors.

The plurality of brands in the marketplace has created much complexity and unfortunately weakened the power of the Air France brand.

Through integration, Air France would see many benefits thanks to fleet, brand, and product harmonisation. Managing the operation would be improved through a common fleet of aircraft. Air France will also be able to ensure a smooth transition of the Airbus A350, currently on order, to the Air France fleet with a more economical cabin configuration.

All Joon flights currently sold or for sale would of course be operated by Joon until the project is completed, and then taken over by Air France.

The simplification of the brand portfolio, while capitalizing on the Air France mother brand, is an undeniable asset for our employees, our customers, and indeed all stake holders. It would also enable Air France to complete this integration without impacting the efficiency of the Air France-KLM Group.

Top Copyright Photo (all others by Joon): Joon (Air France) Airbus A321-211 F-GTAK (msn 1658) CDG (Manuel Negrerie). Image: 942239.

Joon aircraft slide show:

Air France signs a new agreement with its flight attendants

Air France has made this announcement:

After the salary agreement signed on October 19, 2018 by the majority of Air France labor groups, representing 76% of the votes cast in the last elections, Benjamin Smith, CEO of Air France-KLM, continued discussions with these social partners as part of their categorical negotiations.

On January 10, 2019 a new agreement has been signed between Air France and its cabin crew, with unanimous support from the three representative cabin crew unions at Air France – SNPNC, UNAC, and UNSA-PNC.

This signature successfully concludes the categorical discussions held over the past several weeks with representatives of commercial flight crews.

Improvements and Simplification

This balanced agreement represents a major step towards ensuring a strong future for flight attendants at Air France, as well as rebuilding the trust and confidence between cabin crew and the company’s management.

This agreement also improves the working conditions of cabin crew by resolving a number of their concerns. In turn Air France will be able to deliver better service to our customers, elevating the position of Air France in a competitive global marketplace.

Air Malta is the first airline to land an Airbus A320neo at Florence Peretola Airport, brings the Fiorentina football team to Malta

Air Malta has started the New Year on a high note by being the first airline to land an Airbus A320neo at Florence’s Peretola Airport and having the honor of hosting on board the Italian Serie A football team Fiorentina.

This special flight to and from Florence’s airport was made possible after technical studies were undertaken by Air Malta’s Flight Operations team. As no A320neo has ever operated into Florence, the team, together with the operating crew, had to conduct calculations and assessments to seek approval from the Florence Airport Authority prior to be able to fly and operate into this airport.

This achievement was also noted by Airbus, the manufacturers of the A320neo, who have written to Air Malta to congratulate the airline on this achievement and be the first airline to operate with this type of aircraft into Florence airport.

The Fiorentina team’s visit in Malta generated a lot of enthusiasm amongst the Viola Club Malta supporters and football lovers all over the islands and culminated in a triangular tournament with Maltese PremierLeague sides Hibernians and Gżira United.

Whilst Europe was experiencing a very cold spell with heavy snow falls in many cities, the team was greeted with blue skies throughout their stay on the Maltese Islands. This permitted the club to undergo intensivetraining at the Malta Football Association’s Training Grounds in Ta’ Qali.

Various international football clubs are increasingly choosing Malta for their mid-season training camps since the islands offer great training facilities, local support, ancillary services, flight connections and a temperate climate.

Top Photo: Air Malta. The photo shows the Fiorentina football team together with Capt. Emvic Debono, Air Malta’s Chief Officer Flight Operations, and the crew of the flight headed by Capt. Mark Micallef. Photo: Daniel Balzan.

Frontier Airlines starts 2019 with 22 new routes

Frontier Airlines kicked off the new year in style, announcing the addition of 22 new nonstop routes from Raleigh-Durham International Airport (RDU), McCarran International Airport (LAS), Philadelphia International Airport (PHL) and Orlando International Airport (MCO).

Service will begin in the spring of 2019.

Routes and Frequency:

Raleigh-Durham:

ALB	TO/FROM	RDU	Tuesday, Thursday, Sunday
BDL	TO/FROM	RDU	Tuesday, Thursday, Sunday
BOS	TO/FROM	RDU	Monday, Wednesday, Friday, Saturday
CMH	TO/FROM	RDU	Monday, Wednesday, Friday, Saturday
ISP	TO/FROM	RDU	Tuesday, Thursday, Sunday
JAX	TO/FROM	RDU	Tuesday, Thursday, Sunday
PHL	TO/FROM	RDU	Tuesday, Thursday, Sunday
TPA	TO/FROM	RDU	Monday, Wednesday, Friday, Saturday

Las Vegas:

DFW	TO/FROM	LAS	Monday, Wednesday, Friday, Saturday
IAH	TO/FROM	LAS	Tuesday, Thursday, Sunday
DTW	TO/FROM	LAS	Tuesday, Thursday, Sunday
PHL	TO/FROM	LAS	Daily
SAN	TO/FROM	LAS	Monday, Tuesday, Thursday, Friday, Sunday

Philadelphia:

ATL	TO/FROM	PHL	Tuesday, Thursday, Sunday
LAS	TO/FROM	PHL	Daily
MYR	TO/FROM	PHL	Tuesday, Thursday, Sunday
PNS	TO/FROM	PHL	Monday, Friday
RDU	TO/FROM	PHL	Tuesday, Thursday, Sunday

Orlando:

BDL	TO/FROM	MCO	Monday, Wednesday, Friday, Saturday
BOS	TO/FROM	MCO	Daily (From 4/19/19 to 4/29/19 operates Monday, Wednesday, Friday, Saturday)
BWI	TO/FROM	MCO	Tuesday, Thursday, Sunday
DFW	TO/FROM	MCO	Friday, Saturday
IAH	TO/FROM	MCO	Tuesday, Thursday, Sunday
PUJ	TO/FROM	MCO	Monday, Friday

Boston:

MCO

TO/FROM

BOS

Daily

(From 4/19/19 to 4/29/19 operates Monday, Wednesday, Friday, Saturday)

RDU

TO/FROM

BOS

Monday, Wednesday, Friday, Saturday

Top Copyright Photo: Frontier Airlines (2nd) Airbus A320-214 WL N236FR (msn 7389) (Marty, the Marmot) SNA (Michael B. Ing). Image: 944748.

Frontier Airlines aircraft slide show:

Route Map:

Porter Airlines to open a new maintenance base at Thunder Bay in February

Porter Airlines is opening an aircraft maintenance base at Thunder Bay International Airport, as of February 2019. This development contributes to Porter servicing its fleet of 29 Bombardier Q400 aircraft and will create 18 jobs in the city.

“Thunder Bay is an important location in Porter’s network,” said Robert Deluce, president and CEO of Porter Airlines. “This latest investment in a maintenance base demonstrates our ongoing commitment to the community.”

Porter has recently made significant investments in Northern Ontario, including opening a base for pilots and flight attendants in Thunder Bay one year ago.

The maintenance base will be located in an existing hangar at the airport. Porter engineers will perform daily overnight maintenance on two aircraft that will return to service the following day.

Porter currently operates up to seven daily roundtrip flights between the city and Billy Bishop Toronto City Airport.

Photo: Porter Airlines.