Flybe shares

[davewebbsbrain]

So todays news that Stobart group and Virgin are purchasing Flybe for a cut price 2.2 million has meant that the share price has dropoed over 70% to 3.77p, is anyone thinking of snapping some up?

Once the takeover is complete, I can see the price rising again. I think now is a good time to buy.

 

[Member]

Virgin has failed to run a regional airline once before....

 

[davewebbsbrain]

Virgin has failed to run a regional airline once before....

I think the joint venture with Stobart Air, who already run Flybe from SEN will be a success. Big money backing from Virgin I hope will be their main involvement and we can see a few new routes added

 

[Member]

I think the joint venture with Stobart Air, who already run Flybe from SEN will be a success. Big money backing from Virgin I hope will be their main involvement and we can see a few new routes added

it comes down to if they want it as a shuttle to VA (which will probably fail like Little Red did), or if it wants to provide provincial routes that flybe/stobart are currently trying (and failing) to offer.

Virgin Airlines aren't in a good place. This feels more desperate than savvy. I'm not trying to be a dick, and I fly a lot so would love it to work given I'm not near Heathrow, but the business model is extremely complex, it isn't just as simple as a major successful international airline buying a small one and transforming it, the money that's been paid is relatively small and is paying off debt.

 

[davewebbsbrain]

it comes down to if they want it as a shuttle to VA (which will probably fail like Little Red did), or if it wants to provide provincial routes that flybe/stobart are currently trying (and failing) to offer.

Virgin Airlines aren't in a good place. This feels more desperate than savvy. I'm not trying to be a dick, and I fly a lot so would love it to work given I'm not near Heathrow, but the business model is extremely complex, it isn't just as simple as a major successful international airline buying a small one and transforming it, the money that's been paid is relatively small and is paying off debt.

I don't disagree with you but I am hoping that a small injection will push Flybe the right way. They offer some decent routes out of SEN and hopefully will open a few more routes which hopefully will make it profitable. Stobart are doing a decent job at Southend, its a good lite set up so fingers crossed this will be an enhancement

 

[AndyT]

Low Cost business models are very difficult to maintain, especially from regional bases. The main players generally have a hub and then do some regional stuff from there.

Being a purely regional airline has a lot of risk involved, but if they keep it simple and utilise crew hours, routes and aircraft usage sensibly, then it should work from Southend.

Bear in mind that Ryanair are moving in on Southend, as well.

The key with Low Cost is flying regular rotations throughout the day. Ryanair and Easyjet generally only start making money after the first two rotations per day, so route planning is essential.

That said, it's worth taking a punt on the shares, I think. I wouldn't go nuts on them, if it was me, though.

 

[Ricey]

Stobart Air already have experience of operating a low cost airline after they took over Aer Arann.

This can only be a good move for Stobart, Virgin and especially Flybe who I have a number of friends who work for so hopefully they will keep their jobs.

Flybe were the main stay during the days at Southend Airport prior to the Stobart takeover with their Jersey flight. It will be great for them to keep going under the control of Stobart and operating no doubt further flights out of SEN.