Flybe to hold vote on chairman’s future as second offer is tabled

Takeover target Flybe is to hold a shareholder vote in March on whether to oust chairman Simon Laffin, while the airline also mulls two separate proposals for the group.

Flybe said on Monday that following a request from Hosking, its biggest shareholder, it will convene a general meeting to consider resolutions to replace chairman Mr Laffin with Eric Kohn.

Hosking wishes Mr Kohn to investigate the carrier’s recently agreed takeover by the Connect Airways consortium – which consists of Virgin Atlantic, Stobart Group and investment firm Cyrus Capital – for 1p a share.

Flybe said: “The board is writing today to Mr Kohn to invite him to meet with the nomination committee of the board in accordance with its procedures applicable to the assessment of board candidates.

“Following this meeting, in the circular to shareholders accompanying the notice of general meeting, the board will make recommendations to shareholders in relation to the resolutions.”

In order to remove Mr Laffin and install Mr Kohn, over 50% of shareholders must approve the switch.

Simultaneously, Flybe has also received an alternative financing proposal from ex-Stobart CEO Andrew Tinkler.

It comprises a “capital injection and replacement of the funding” provided by Connect.

Shares in Flybe jumped over 25% in morning trade to 4p.

However, the airline said that it “does not consider that the preliminary proposal offers the certainty required to secure the future of Flybe”.

Under the terms of the Connect deal, which the group favours, the buyers will pay £2.8 million to take control of the main trading company Flybe and the online arm Flybe.com.

It will later complete the purchase of the wider holding company for 1p a share.

Connect has also committed to make available a £20 million bridge facility to support Flybe’s working capital and operational requirements.

In addition, following completion, it intends to provide up to £80 million of further funding.