Flybe has received the first £10 million in funding as part of its takeover by the Connect Airways – a consortium led by Virgin Atlantic and Stobart Group and also includes Cyrus Capital Partners.
The cash is needed to maintain the operations of Flybe until the takeover can be completed. Flybe has sought to reassure investors that the deal is on track and said it will be finalised on 22 February.
However, the airline said it had failed to meet the conditions for a promised £20 million bridge loan under the deal as credit card banks clamped down amid fears over the carrier’s financial security. But the consortium of bidders have now offered immediate financial support, with a revised loan of up to £20 million.
“The arrangements with the company’s credit card acquirers and banks are important to enable Flybe to continue to trade and are conditional themselves upon the SPA (share purchase agreement completing),” a statement said.
Earlier in this month, the consortium agreed to a revised takeover of Flybe for £2.8m
Shareholders in Flybe will receive 1p a share, while the consortium has committed to inject £100 million into the airline.
Flybe has also agreed with IAG-owned low-cost Spanish carrier Vueling Airlines to sell its slots at London Gatwick Airport for £4.5 million.