Flybe administrators deny talks with government about nationalising airline

‘No discussions’ are happening at present says EY

Flybe was hit hard by coronavirus (AFP/Getty)

The administrators for Flybe have denied opening talks with the government about nationalising the failed airline.

Accountancy firm EY told The Independent there are “no discussions” happening on this front after it was widely reported that they had asked the government to contemplate buying the carrier out of insolvency to serve regional routes.

The Telegraph reported that Flybe was discussing the possibility of nationalisation with ministers, “according to industry sources”.

However, an EY spokesperson said of the claims: “We continue to be open to approaches from all parties in order to realise returns for creditors.

“At this time, we can confirm that there are no discussions between the Joint Administrators and Government about taking Flybe Limited out of insolvency.”

It comes after airlines and airports in the UK were told there wouldn’t be an industry-wide government bailout amid the coronavirus pandemic.

Chancellor Rishi Sunak wrote to aviation executives last week to say that he would only consider discussing measures to shore-up individual businesses as a “last resort”, and that this would be done on a case-by-case basis rather than applied across the board.

He repeated the package of measures announced on Friday that will be available to all British industries: postponing some rates and tax payments and paying the majority of employed staff members’ wages.

Sunak added that “taxpayer support would only be possible if all commercial avenues have been fully explored, including raising further capital from existing investors”. It followed the news that easyJet, among other airlines, was continuing to pay out dividends to shareholders, to the tune of £171m. The airline’s founder and largest shareholder, Stelios Haji-Ioannou, received £60m.

Flybe was an early victim of the world-wide travel slow-down due to coronavirus, and officially ceased trading on 5 March.

Europe’s biggest regional airline was already struggling financially when the crisis hit, having been saved from the brink of insolvency several times prior.

The latest of these included controversial government intervention, with ministers agreeing the carrier could defer paying its air passenger duty until a later date.