UK Government agrees rescue plan for FlyBe
The UK Government has agreed a rescue plan for regional airline FlyBe, which is facing serious financial troubles.
It was reported on Monday that the airline, which is a major carrier of passengers from regional areas of the UK to mainland Europe, was facing collapse.
Now, Government ministers have agreed to work with FlyBe to help create a repayment plan for tax debt reported to top £100m. UK Business Secretary Andrea Leadsom said the deal would keep the company operating, although specifics of the deal have not been disclosed.
The firm's owners have also agreed to pump more money into the loss-making airline.
British Airways, one of FlyBe's main competitors, have come down against the deal. BA CEO Willie Walsh, in a letter to UK Transport Secretary Grant Shapps, said it was a "misuse" of public funds, and that taxpayers should not be footing the bill for the airline's mismanagement.
Flybe flies 8.5m passengers a year to 170 European destinations. The airline put itself up for sale in late 2018, warning that its cash reserves were running low, and was subsequently bailed out for £2.2m by the Connect Airways consortium, which comprised Virgin, Stobart and Cyrus Capital.
If Flybe goes under, it would be the second major UK airline collapse in four months, following Thomas Cook Group’s collapse last September.