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Flybe-9

Old 13th Jan 2019, 17:26
  #1401 (permalink)  
 
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Originally Posted by davidjohnson6 View Post
Has a date been set for the Flybe shareholders to vote on the takeover ?
The timetable has not been published. The timetable will be published within 28 days of the announcement.
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Old 13th Jan 2019, 17:35
  #1402 (permalink)  
 
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The longer it takes before shareholders in all companies vote, the greater the potential for the deal to fall apart. The precarious state of Flybe's finances suggest that customers will be wary of booking with Fybe, especially for dates far in advance.
If things really are as bad for Flybe as the 1p per share price implies, then all companies involved should presumably be wanting to get all approvals and everything finished earlier rather than later
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Old 13th Jan 2019, 17:39
  #1403 (permalink)  
 
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  • Seven pairs of LHR remedy slots can be used for Europe from March next year (2020)
  • Same seven pairs can also be swapped or traded from March next year too
  • Five more pairs have to be used for domestic until March 2022 then the same applies
Buy a sinking ship for £2.2m. Put in £20m to tide it over. Offer 'up to £80m' for later - no specific promises though. Cherry pick the best of the current network. Bring in short-haul partner to prop up the operation. Do deals on the seven LHR slot pairs when they can be traded in 2020 - AF/KL intra-EU, VS/DL long haul, or 'sell' them. Do the same with the other five pairs in 2022. Drop LHR UK domestic ops - '"we tried but it didn't work" If what's running around the provinces still isn't making money by then shut the rest down too.

Twelve LHR slot pairs for £22.2m down plus whatever it takes to keep the former Flybe going until 2022. How much are well-timed pairs worth?
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Old 13th Jan 2019, 17:43
  #1404 (permalink)  
 
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The slots can't be traded, sold or swapped. They can be used for other European routes in the time frame noted above.
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Old 13th Jan 2019, 18:21
  #1405 (permalink)  
 
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Originally Posted by Flightrider View Post
The slots can't be traded, sold or swapped. They can be used for other European routes in the time frame noted above.
Once the three years are up, it appears that they can be traded... Quoting European Union regulation (EC) No 139/2004 – Merger procedure
  • As a general rule, the slots obtained by a prospective entrant must be operated on the city pair(s) for which they have been requested… and cannot be used on another city pair unless the prospective entrant has operated them during at least six full consecutive IATA seasons (the ‘ulitisation period’).
  • Once the utilisation period has elapsed, the prospective entrant would be entitled to use the slots… to operate services on any route connecting London with any other part of Europe.
  • During the utilisation period, the prospective entrant shall not be entitled to transfer, assign, sell, swap or charge… any slots obtained...
It only says they cannot be transferred, assigned, sold or swapped during the utilisation period, which is six IATA seasons.
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Old 13th Jan 2019, 18:26
  #1406 (permalink)  
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Originally Posted by Albert Hall View Post
... after some of the bullish statements from the Chairman and CEO in relatively recent times.
Sadly, that is what many modern CEOs see as their job 'talk it up'. My fater worked in Personnel (long before HR ) and he said that, when the big boss announces a merger/takeover and says that jobs are safe - is the time to start looking for a new job.
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Old 13th Jan 2019, 18:31
  #1407 (permalink)  
 
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EastMids - read on!

1.3.7 For the avoidance of doubt, the Slot Release Agreement may: (a) contain prohibitions on the Prospective Entrant transferring its rights to the Slots to a third party, making the Slots available in any way to a third party for the use of that third party, or releasing, surrendering, giving up or otherwise disposing of any rights to the Slots; and/or
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Old 13th Jan 2019, 21:19
  #1408 (permalink)  
 
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Question to the corporate savvy people out there: What would be the consortium's next move if a majority of shareholders reject the 1p offer, and what do said shareholders have to lose (apart from 1p X shareholding) by rejecting the offer?
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Old 13th Jan 2019, 21:43
  #1409 (permalink)  
 
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Raise the offer to a higher price - maybe 4p per share given the price at the moment - and label the offer as 'final'

Shareholders have to decide if after all debts, leases and other obligations have been paid, whether any money more than 1p per share is left for them in the event of bankruptcy
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Old 13th Jan 2019, 22:31
  #1410 (permalink)  
 
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75% of shareholders have to accept for the deal to go through. Andrew Tinkler is sitting on 10%. Assuming that he has paid more than 1p per share, he needs to get 25% to be certain of not losing money. If he succeeds in buying a blocking stake, is he going to force his way in to the deal?
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Old 13th Jan 2019, 22:52
  #1411 (permalink)  
 
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Tinker has stated that he 'does not intend on disrupting' the process which if true, suggests his purchase was made to help ensure the deal goes through. Whilst he has spent a considerable amount getting a 10% stake in flybe, he owns a good chunk of Stobart who's shares having increased substantially as a result of the bid. The rise in the value of his Stobart holding more than make up for the amount spent on Flybe.
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Old 13th Jan 2019, 23:30
  #1412 (permalink)  
 
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Jobsa, have you been reading ‘The Prince’ by Nicola Machiavelli? If I have got this right, you think Andrew Tinkler has been buying shares at greater then the offer price in order to facilitate another company that he is a shareholder in buying flybe at a cheaper price?
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Old 13th Jan 2019, 23:31
  #1413 (permalink)  
 
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Originally Posted by runway30 View Post

Costs will be increased to provide Virgin service standards and pay fees for using the Virgin name. Anything that doesn’t feed Virgin or contribute to the growth of SEN must surely be at risk.
That is the bit I see as being an issue.

If Flybe couldn't make it work and increase fares then why is giving an aircraft a paint job, putting staff in new uniforms and calling it a different name going to make people want to pay more ?
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Old 13th Jan 2019, 23:37
  #1414 (permalink)  
 
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Originally Posted by runway30 View Post
I think those of you who think that this will just be flybe with Virgin branding or don’t believe that everything could change from route network to aircraft will be sadly mistaken.
I don't think people do BUT when you have Airlines like Ryanair and Easyjet than have the resources to move air frames at will then Flybe/Virgin has little chance of expanding on high passenger routes. If interlining passengers start using VS more than BA then BA will just take the hit in offering lower fares to chuck a spanner in the works.

I see little in it for Virgin.
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Old 13th Jan 2019, 23:49
  #1415 (permalink)  
 
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Originally Posted by runway30 View Post


Well the shareholders can reject the 1p offer if they wish but clearly the directors don’t think it is possible to carry on as an independent company. Andrew Tinkler must have paid more than 1p per share for his 10% stake and so won’t be very keen to sell.
As he has an ongoing legal action then he may be keen to sell were an agreement reached on the legal dispute.

BIG problem however in that Connect bought the shares of Flybe Plc at a particular price and that offer is to the majority of shareholders. An official offer must be made at a certain fixed price. Stock market does NOT allow certain shareholders to get a premium price above other shareholders so holding 100 shares or 100,000 is irrelevant as you get same price.

Therefore if legal agreement settled, such that Mr Tinkler sold his shares at the certain fixed price in consideration that legal agreement was settled. A shareholder who had to sell his shares for 1p may say but Mr Tinkler because of his separate legal action, which forced a separate company involved in this deal to settle, got 12p per share then I should also get the same amount. I am not wholly sure there is settled law on this but can guarantee if I bought at 16p and lost 15p I would be going to court.
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Old 13th Jan 2019, 23:53
  #1416 (permalink)  
 
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Runway....my thinking is that Tinkler owns about 8% of Stobart. With circa 350m shares in circulation that equates to about 28m in his ownership. As a result of the bid on Friday, Stobarts share price increased 7.7% (10.8p) increasing the value of his stake by about £3m. His purchase in Flybe would have cost him circa £750k meaning he's still up over £2m. If I were him, protecting the value of his Stob stake I'd want the consortium bid to go through. Bizarre - yes. Crazy - maybe not as much as it might appear.
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Old 13th Jan 2019, 23:54
  #1417 (permalink)  
 
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Originally Posted by EastMids View Post


Once the three years are up, it appears that they can be traded... Quoting European Union regulation (EC) No 139/2004 – Merger procedure
  • As a general rule, the slots obtained by a prospective entrant must be operated on the city pair(s) for which they have been requested… and cannot be used on another city pair unless the prospective entrant has operated them during at least six full consecutive IATA seasons (the ‘ulitisation period’).
  • Once the utilisation period has elapsed, the prospective entrant would be entitled to use the slots… to operate services on any route connecting London with any other part of Europe.
  • During the utilisation period, the prospective entrant shall not be entitled to transfer, assign, sell, swap or charge… any slots obtained...
It only says they cannot be transferred, assigned, sold or swapped during the utilisation period, which is six IATA seasons.
Brexit changes all of that I believe as not following EU rules will be par for the course.
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Old 14th Jan 2019, 00:00
  #1418 (permalink)  
 
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Originally Posted by runway30 View Post
75% of shareholders have to accept for the deal to go through. Andrew Tinkler is sitting on 10%. Assuming that he has paid more than 1p per share, he needs to get 25% to be certain of not losing money. If he succeeds in buying a blocking stake, is he going to force his way in to the deal?
In a Stockmarket takeover you need 50.00001% to have won control. When you have 90% of the shareholding you can cancel the Stockmarket listing and acquire the rest of the shares and sent a cheque to the owners of said shares at the value of the offer. This happened with Glazer takeover at Manchester United among many that have taken place.

One you have 50% you can appoint the board and everybody else.
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Old 14th Jan 2019, 00:13
  #1419 (permalink)  
 
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Originally Posted by racedo View Post
In a Stockmarket takeover you need 50.00001% to have won control. When you have 90% of the shareholding you can cancel the Stockmarket listing and acquire the rest of the shares and sent a cheque to the owners of said shares at the value of the offer. This happened with Glazer takeover at Manchester United among many that have taken place.

One you have 50% you can appoint the board and everybody else.
Racedo, you might have missed that they have gone for a scheme of arrangement. If approved by the Court, there is a threshold of 75% rather 90% which if passed allows you to compulsorily to acquire the minority
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Old 14th Jan 2019, 00:16
  #1420 (permalink)  
 
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Originally Posted by JobsaGoodun View Post
Runway....my thinking is that Tinkler owns about 8% of Stobart. With circa 350m shares in circulation that equates to about 28m in his ownership. As a result of the bid on Friday, Stobarts share price increased 7.7% (10.8p) increasing the value of his stake by about £3m. His purchase in Flybe would have cost him circa £750k meaning he's still up over £2m. If I were him, protecting the value of his Stob stake I'd want the consortium bid to go through. Bizarre - yes. Crazy - maybe not as much as it might appear.
Jobsa, as Racedo has kindly pointed out, I was thinking of the legal implications.
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