Stobart bids for fresh Aer Lingus deal to speed regional airline sale

Stobart Group has entered a tender to secure a long-term flying agreement with Aer Lingus beyond 2022 as part of its effort to dispose of regional carrier Stobart Air before the end of March 2021. The group bought back regional carrier Stobart Air and lessor Propius earlier in 2020 from the administrators of Connect Airways, just a year after the units had been acquired by the consortium – in which Stobart held a 30% stake. The move was aimed at mitigating its financial exposure – which dates back to 2017 – and Stobart subsequently began looking at the potential disposal of the regional carrier. In September it confirmed it was in “early stage” discussions with a number of parties including Falko Regional Aircraft over the possible sale of Stobart Air and Propius. The Irish Independent recently reported these talks had stalled, partly because Aer Lingus had put the contract for the regional service out to tender. Regional specialist Stobart Air has operated franchise flights for Aer Lingus since 2010 and has a contract until the end of 2022. In releasing its interim results Wednesday, Stobart highlights that continued quarantine restrictions in Ireland and the related hit on travel demand means most of Stobart Air’s fleet is grounded. This has placed significant cash strain on the business because of ongoing aircraft lease agreements. The total cash burn for Stobart Air and Propius since acquisition is around GBP14.7m, it says.<br/>