The reason is pretty clear in
http://www.gov.im/lib/docs/airport/p...lywebsite1.pdf - Liverpool is in decline and if you work the Arran figures back, they had a total of 9,730 in April. Dublin accounted for 3,102 of these and if you assume they had 50% of the Luton market (say 3,000 out of 5,921), this leaves just 3,600 for them on Liverpool, so Euromanx must have carried almost 12,000 of the 15,000 on the route, giving Arran market share of around 20%.
The withdrawal seems part of an overall tidying up of their network over the last few months - I presume the cancellation of the expedition to Liege, other routes out of Luton and the Isle of Man to Manchester and Liverpool didn't stack up with the bean counters in the clear light of day, and these aircraft will be used more profitably elsewhere.
Euromanx will benefit certainly but they will come under huge scrutiny to make sure they don't try to jack up the prices now that they have the route to themselves again. The reason Arran were encouraged onto the Liverpool route was partly because the IOM Government wanted a competitor to put manners on Euromanx, who wasted no time in pushing fares up after Emerald went away.
So, what odds on Manx2 having a go at Liverpool with 20 Let 410s per day?