Rivals face Flybe fight

Warring pair in takeover battle

SHARES in struggling Flybe rocketed by a third yesterday as Virgin Atlantic and the owner of British Airways prepared for a takeover battle.

Reports say International Airlines Group, which includes BA, Iberia and Vueling, is a frontrunner to bag Flybe – sending IAG’s shares up 1.8%.

But it is set to go head to head with Virgin Atlantic, which confirmed its interest last Friday.

Flybe put itself up for sale earlier this month as part of a “strategic review”.

It coincided with the Exeterbased carrier announcing half-year profits plunged 54% to £7.4million.

The future of the airline has big implications for a number of regional UK airports, as well as the carrier’s 2,300 staff.

IAG’s apparent interest would pit its chief executive Willie Walsh against Virgin tycoon Sir Richard Branson. The pair have been bitter rivals since Walsh made a bet with Branson in 2012 that Virgin Atlantic would not last another five years.

Although shares in Flybe rocketed yesterday they are still down sharply over the year so far.

Meanwhile, holiday giant Thomas Cook is expected to lay bare the impact of a European heatwave and a fall in demand for last-minute trips abroad when it unveils falling profits on Thursday. City analysts forecast the firm will post a 15% dive in underlying profits to £280million for the year to September.