Stobart Air sale talks up in the air after tender move

Dublin-based carrier operates Aer Lingus Regional service

TALKS between CityJet owner Falko and the UK’s Stobart Group to acquire Aer Lingus Regional operator Stobart Air are facing an impasse after Aer Lingus put the contract for the regional service out to tender recently, it’s understood.

Some sources suggested that talks between the two sides have all but collapsed, citing undertakings sought as part of a sale in relation to Stobart Group’s $100m in liabilities attached to Dublin-based Stobart Air, and other factors.

However, others stressed that the negotiations have still not reached a stage where an offer has been tabled, and insisted that they have not broken down.

“The group is engaging actively with a number of parties interested in acquiring its stake in Stobart Air,” said Stobart Group yesterday.

The Irish Independent revealed last month that Aer Lingus had put the contract to operate the Aer Lingus Regional service from 2023 out to tender. Stobart Air’s current contract will expire at the end of 2022.

This newspaper also first revealed that Stobart Group, whose CEO is Warwick Brady, had entered into talks with aircraft leasing firm Falko about a potential acquisition of Stobart Air.

Last week, Mr Brady told investors that he expects a sale of Stobart Air to be completed by February next year and said that Stobart Group is “entirely focused on sorting out Stobart Air”.

It’s believed that Stobart Group, which also owns London Southend Airport, wants network coverage in the UK that will encompass the gateway as part of a Stobart Air sale.

But any sale that might be inked in coming weeks is almost certain to be conditional on Stobart Air retaining the contract to operate the Aer Lingus Regional service beyond 2022.

It’s understood that bids for the contract have to be submitted to Aer Lingus by the middle of this month. A number of parties are believed to have shown an interest in providing the service.

It’s not clear when a decision on awarding the contract will be made, but sources suggested a decision could be made relatively soon.

Dublin-based carrier CityJet emerged from examinership earlier this year and is currently operating services on behalf of SAS.

Stobart Air is currently operating a limited schedule, as airlines continue to be hit hard by the Covid pandemic. It recently launched services from Belfast City Airport, however, to destinations in the UK such as Glasgow.

‘Stobart CEO expects sale of Stobart Air by early next year’