Cumbrian tycoon Andrew Tinkler has waded into the takeover of Flybe – offering a capital injection should a deal for the struggling airline fall through.

Flybe has confirmed that its advisers have held discussions with Mr Tinkler’s advisers over a “very preliminary, short and highly conditional outline contingency proposal” from the high-profile county-based businessman which “envisages a capital injection and replacement of the funding provided by Connect Airways Limited”.

The discussions were held on February 1 – 21 days before target date set for Connect Airways Limited to complete its takeover over Flybe.

Connect Airways is a joint venture company partly owned by Stobart Aviation, the subsidiary of Stobart Group – the company Mr Tinkler led as chief executive until 2017 and which sensationally sacked him as an executive board director last summer for an alleged breach of contract, a charge which he denies.

Stobart Aviation, along with fellow owners Virgin Atlantic and investment firm DLP Holdings Sarl, are aiming to invest up to £100 million into Flybe, which was put up for sale in November in the wake of a profit warning blamed on falling demand, a £29m hit from rising fuel costs and the weak pound.

In a statement, Flybe said its board “understands” that the cash injection from Mr Tinkler would only be made if the sale to Connect Airways does not complete.

It stressed that the preliminary proposal did “not contemplate an offer for the whole of Flybe or any other acquisition structure”.

“The Board does not consider that the Preliminary Proposal offers the certainty required to secure the future of Flybe,” it said.

“Accordingly, the Board emphasises to shareholders that it continues to regard the arrangements entered into with Connect Airways as being the only viable option available to the Company which provides the security that the business needs to continue to trade successfully. 

“The arrangements with Connect Airways preserve the interests of Flybe's stakeholders, customers, employees, partners and pension members.”

Despite the apparent knock-back, Mr Tinkler said he remained hopeful that discussions will continue with Flybe.

“We look to the Board to continue engaging positively with regard to our outline proposal, for the benefit of all shareholders,” he added.

The takeover by Connect Airways is already far down the runway, having committed £15m of a £20m bridge facility to support Flybe's ongoing working capital and operational requirements.
It is also planning to invest up to £80m to support Flybe’s growth.

The takeover would see Virgin Atlantic operate a network of regional flights provided by a combination of Flybe and Stobart Air.

Flybe has 78 planes operating from smaller airports including London City, Southampton and Norwich, carrying around eight million passengers to destinations across the UK and Europe.

Mr Tinkler’s entrance mid-takeover comes just weeks after he bought a 10 per cent stake in Flybe. The tycoon – who is widely credited as being the driving force behind the success of Stobart Group – was said he was not seeking to disrupt the takeover by Connect Airways.

However, his very public battle with Stobart Group spilled into the High Court at the end of last year, with the company accusing him of conspired with other businessmen to harm the company's interests. A final judgement is expected soon.