the_tyke
4th Jul 2003, 22:13
From the Daily Telegraph, July 4 th.
"FLYBE, the low-fare regional airline owned by the trustees of the late Jack Walker, plans to start talks next year over the potential sale of the business.
The airline, which is being courted by venture capitalists and is currently valued at around £100m, is considering raising new finance to fund a $500m programme to replace its 15 BAE 146 aircraft with larger Airbus or Boeing jets.
The Walker trustees, which own around 80pc of the shares, have employed an unidentified investment boutique to advise on the potential sale.
Yesturday Jim French, Flybe's chief executive, said:"We have had a lot of venture capitalists making approaches. When we have got a better grip of which larger aircraft we are going for, that's the time we will sit down and have detailed discussions with those who have shown interest in this business."
He envisaged the timescale for such talks would be "a year to 18 months".
The airline was founded 25 years ago by Mr Walker, the steel magnate who bankrolled Blackburn Rovers football club.
Over the past two years, Mr French has led a transformation of the business into a low-fare regional airline with bases at Southampton, Belfast, Birmingham and in the Channel Islands. Next Wednesday, it will announce several new routes from a new base at Exeter.
The switch to a low-fare model has transformed its profitability. Flybe lost £16.4m in the year to March 31 2002 and £800,000 last year, but is expected to return to the black this year with around £2.5m profits on almost £240m sales. Passenger numbers are expected to rise 29pc this year to 3.6m. Turnover is already similar to that of low-fare airline Go when it was sold to Easyjet last year for a net £258m, though at the time Go had £17m profits.
To increase current valuations for Flybe, which has higher costs than Go, Mr French must hit his target 25pc annual revenue growth and raise operating margins to 10pc.
Plans to buy 150-seat aircraft to replace the BAE 146s follow April's order for 17 Bombardier Q400s to replace eight Dash 8s and four regional jets, as well as expand the fleet."
"FLYBE, the low-fare regional airline owned by the trustees of the late Jack Walker, plans to start talks next year over the potential sale of the business.
The airline, which is being courted by venture capitalists and is currently valued at around £100m, is considering raising new finance to fund a $500m programme to replace its 15 BAE 146 aircraft with larger Airbus or Boeing jets.
The Walker trustees, which own around 80pc of the shares, have employed an unidentified investment boutique to advise on the potential sale.
Yesturday Jim French, Flybe's chief executive, said:"We have had a lot of venture capitalists making approaches. When we have got a better grip of which larger aircraft we are going for, that's the time we will sit down and have detailed discussions with those who have shown interest in this business."
He envisaged the timescale for such talks would be "a year to 18 months".
The airline was founded 25 years ago by Mr Walker, the steel magnate who bankrolled Blackburn Rovers football club.
Over the past two years, Mr French has led a transformation of the business into a low-fare regional airline with bases at Southampton, Belfast, Birmingham and in the Channel Islands. Next Wednesday, it will announce several new routes from a new base at Exeter.
The switch to a low-fare model has transformed its profitability. Flybe lost £16.4m in the year to March 31 2002 and £800,000 last year, but is expected to return to the black this year with around £2.5m profits on almost £240m sales. Passenger numbers are expected to rise 29pc this year to 3.6m. Turnover is already similar to that of low-fare airline Go when it was sold to Easyjet last year for a net £258m, though at the time Go had £17m profits.
To increase current valuations for Flybe, which has higher costs than Go, Mr French must hit his target 25pc annual revenue growth and raise operating margins to 10pc.
Plans to buy 150-seat aircraft to replace the BAE 146s follow April's order for 17 Bombardier Q400s to replace eight Dash 8s and four regional jets, as well as expand the fleet."