Aer Lingus Regional Service Operator Stobart Air Experienced €36.8m Loss Last Year; Planned Sale To Isle Of Man Company Ettyl Limited In Doubt
Aer Lingus Regional service operator Stobart Air experienced a €36.8 million loss last year.
As reported by The Irish Independent, according to newly-filed accounts for Stobart Air's immediate holding company, continued losses in 2021 pushed Stobart Air's net liabilities to €68.5 million at the end of last March.
Stobart Air reportedly operated 5% of its usual operating schedule during the second quarter of 2020 due to the COVID-19 pandemic, and continued to fly publicly-funded public service obligation (PSO) services from Dublin to Kerry and Donegal.
Stobart Air's contract to operate Aer Lingus Regional services will expire at the end of 2022.
It was reported late last year that businessman Conor McCarthy's Emerald Airlines would enter exclusive talks with Aer Lingus to take over the Aer Lingus Regional service following the expiration of Stobart Air's contract, and, as reported by The Irish Independent, Aer Lingus has since named Emerald Airlines as the preferred bidder to take over its regional service.
Stobart Air's majority owner, aviation and energy infrastructure group Esken announced earlier this year that it had signed an agreement for the sale of its entire shareholdings in Stobart Air Unlimited Company and Stobart Air (UK) Limited to Isle of Man company Ettyl Limited.
However, as reported by The Irish Independent, the planned sale of Stobart Air to Ettyl is in doubt due to newly-emerged funding concerns.
Esken stated on its website, "Esken has become aware that Ettyl's proposed financing for the transaction is no longer available and understands that Ettyl is progressing discussions with another potential financing source. Esken is investigating these matters and seeking further information, including with regard to the impact this may have on the ability of Ettyl to finance the transaction and obtaining the change of control consents required in order to complete the transaction. Esken is discussing this matter with its lending banks given banking facility consent for the sale has been obtained.
"A further announcement will be made when appropriate."
Esken previously stated that the sale "is subject to certain change of control and bank facility consents that were expected in early May… Banking facility consent has been obtained. However, concluding the change of control consents is taking longer than was envisaged at the time of the announcement of the transaction."
According to The Irish Independent, Eyttl has alerted Isle of Man police about concerns that it has about documents supplied by one of the possible backers of its acquisition of Stobart Air.
As reported by The Irish Independent, according to a report in The Daily Telegraph, Ettyl confirmed that it "raised concerns with the Isle of Man Constabulary as soon as it became aware of an issue with the paperwork…[and] is now in discussions with potential alternative providers of finance".
According to The Irish Independent, Ettyl agreed to pay a nominal £2 for Stobart Air, plus the value of any cash on the balance sheet upon the sale's completion, and a £7.5 million contingent consideration is payable if certain trigger events occur at any point up to July of 2024.
Also according to The Irish Independent, upon completion of the sale of Stobart Air, Esken is due to make a £9.4 million payment and would be responsible for the settlement of pre-completion liabilities amounting to £25.8 million.
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