Flybe investor moves to eject chairman over airline sale
Struggling airline Flybe has confirmed that its biggest shareholder, Hosking Partners, has moved to eject chairman Simon Laffin and ordered a probe into its takeover.
The airline said on Monday that the investor has requested the company convene a general meeting to consider resolutions to replace Mr Laffin with Eric Kohn.
Flybe - which is being taken over by Virgin Atlantic, Stobart Group and investment firm Cyrus Capital Partners - said in a stock market update that Hosking also wants Mr Kohn to investigate the sale process.
Hosking objects to the deal, which will see Flybe sold for 1p a share.
Shares in Flybe jumped over 31% in morning trade to 4.5p.
But the airline said it has "full confidence" in Mr Laffin and believes that "any independent scrutiny of its conduct will support the board's decision-making".
It said: "The board reaffirms that it has acted at all times in the interests of its shareholders and all its stakeholders, through an extremely difficult and challenging period.
The board continues to have full confidence in its chairman, Simon Laffin, and believes that any independent scrutiny of its conduct will support the board's decision-making.
Under the terms of the deal, the buyers - known collectively as the Connect Airways consortium - will pay £2.8 million (€3.2m) to take control of the main trading company Flybe and the online arm Flybe.com in a deal set to complete by February 22, while later concluding the purchase of the wider holding company for 1p a share.
However, Hosking has expressed concerns that Flybe allowed a false market to develop by failing to notify the City of its financial position quickly enough.
Flybe confirmed on Thursday that shareholders will not be able to vote on the initial disposal of the main trading assets of the airline, but only the 1p-a-share sale of the remaining holding company.
Under the takeover plans, the airline will be combined with Stobart Air in a joint venture.
Cyrus will own 40% of the new company, while Virgin and Stobart will take 30% apiece.
