Without the £10m put down with the deal to buy, Flybe would have had to close down.
Assets on a balance sheet are valued as a going concern, once the doors close on a business usually a 10% value is given.
This is far from a done deal, I have been sad enough to read the sale agreement and it contains a Brexit agreement. Assuming a deal on the 29th March, Virgin becomes a european company as does IAG. The e.u. this month has once again clearly pointed out that no amount of creative opening of new companies, its the place of residency of the shareholder that determines whether a european or u.k. company not a AOC issued by any country.
I am a Ryanair shareholder and on the 29th March we become a u.k. airline, the company is trying to make u.k. shareholder non voting, but the e.u. quite rightly sees this as game playing, never mind the shareholders refusing this option.
Common sense is the order of the day at the moment and both the e.u. and the u.k. have decided whether a deal or no deal, existing rules will run until the end of this year.
The new Connect company wont obey e.u. regulations to be a u.k. airline and it certainly wont have grandfather rules on flight networks, that also come in to play for this company.
When you throw in Mr Tinker who awaits a judgement on his dispute with Stobart and its no surprise he has taken a stake and Hoskins with their 20% stake taking the view that Virgin and Stobart, with the later having tabled a bid, are frustrating the market with their joint bid.
The legal costs alone may sink the company.