Stobart Group confirms sale of Southend Airport stake but warns of coronavirus delay
Logistics firm Stobart Group has confirmed that it is in talks to sell a 25 per cent stake in London Southend airport, but that the sale will be delayed due to the coronavirus outbreak.
Yesterday Sky News first reported that German-based Avi Alliance had made a £700m approach for a quarter of the airport, with Stobart today confirming the deal could be worth up to £800m.
In a statement, the firm said talks had been ongoing for several months but had now “been put on hold” due to the spread of the virus.
The announcement meant that Stobart was one of very few companies with shares in the black today, with stock gaining 3.8 per cent by the early morning.
Alongside the announcement the FTSE 250 firm, which also owns rail and freight businesses, said that it was seeking extra cash due to the impact of coronavirus.
Stobart warned that it was “not possible” to provide accurate guidance at this stage as to what the overall effect on finances and passenger numbers would be.
Sign up to City PM’s Midday Update newsletter, delivered to your inbox every lunchtime
The firm also said that it is actively evaluating to address and manage the liabilities arising following the collapse of Flybe, in which it held a 30 per cent stake.
The regional carrier fell into bankruptcy earlier this month after failing to agree a state aid package with the government.
Its demise was hastened by the onset of Covid-19, which has devastated passenger demand for airlines around the world.
Several other carriers are tipped to follow Flybe into administration unless governments are prepared to support them.
Stobart’s chief executive Warwick Brady struck a defiant note, saying: “Despite the current challenges presented by the Covid-19 virus, we continue to own and operate aviation and energy assets with significant underlying value.
“It is impossible to say what structural changes will occur to the aviation industry in the coming months. However, ultimately the current crisis will pass, and people will continue to want to fly in and out of one of the world’s largest travel markets”.