Administrators of collapsed UK regional carrier Flybe are finalising the sale of its aircraft support operation, Flybe Aviation Services, which has continued to trade.
The EY administrators, in a statement of proposals, say they are aiming to complete the transaction “in the coming days” after receiving offers for the division.
Flybe Aviation Services is based in Exeter and has European approvals supporting various aircraft types including Embraer ERJs and E-Jets, Bombardier CRJs and turboprops, ATRs and a number of others.
The administrators state that they also plan to sell a maintenance function once it is no longer needed to service the remaining Flybe fleet.
Flybe’s maintenance approval was restored on 10 March, five days after the carrier ceased operations, in order for the administrators to preserve the fleet of 65 aircraft.
Leases were terminated after the airline failed but return of the aircraft has been “hampered” by the fleet’s not being in the condition required, the administrators state, with a need for a “significant amount” of asset swaps to restore them. Lessors and financiers of these aircraft have agreed to cover costs arising from the maintenance.
“The current market for [aircraft] is significantly depressed and current offers have been markedly low against valuation,” the administrators add, and reseller options are being considered. Engines are also being marketed, some of would need removing from aircraft before sale.
Flybe’s operating loss for the fiscal year to 31 March reached £215 million, the statement of approvals reveals, around the same level as its market capitalisation when the company undertook its initial public offering in 2010.
It adds that – unsurprisingly – unsecured creditors will not receive any return from the company. Total unsecured claims have reached at least £317 million, with only £600,000 available for distribution, meaning that even the typical investment of about £100 would return just £0.20, less than the cost of postage to inform the creditor.
