Planestation buys stake in no-frills airline

Planestation, the UK-listed airport company, yesterday snapped up a 30 per cent stake in EUjet, the fledgling budget airline headed by PJ McGoldrick, the former Ryanair chief executive, for £2m.

Later this year, EUjet is set to become the first passenger airline to start flying from Manston airport in Kent, which is Planestation's biggest investment.

Planestation's chief executive Martin May said he hoped the arrival of EUjet would be the first step towards turning Manston - dubbed Kent international airport - into one of Britain's leading regional airports. The airline has plans to start with a handful of popular business routes in September, expanding to eventually cover 21 European destinations.

Mr May said: "I think this deal enhances the value of Manston airport. EUjet has good credentials and this deal will give us representation on the board. With the support of the local community, Manston can do very well."

He added that a 2,000-space car park is already under construction at Manston and a customs inspection post had recently been established, enabling the airport to increase international freight capacity. He said there were also plans to build a railway station at the airport by 2007, as well as current interest in building a hotel for the site.

Mr May said Planestation's investment in EUjet would not be a risky prospect for the company but would instead enhance the development of both businesses.

"Because they're now putting together a business plan with less risk - starting on a small scale - we found this was an excellent opportunity to get a foothold, and ensure the airport was successful."

EUjet plans to start with a fleet of seven Fokker 100 aircraft and is currently negotiating with other European airports to secure landing slots for its routes.

Shares in Planestation rose more than 6 per cent to 4.85p on yesterday's news, giving the firm a market cap of £103m.