Virgin Atlantic, Flybe and Stobart Air: longhaul, meet shorthaul

There are very few examples anywhere in the world, and none in Europe, of a single airline brand combining long haul widebody operations with short haul regional aircraft, without there also being a narrowbody business sitting between these two extremes.

The bid for Flybe by Connect Airways, a consortium consisting of Virgin Atlantic Airways, Stobart Group and US investment form Cyrus, will do this.

Recommended by Flybe's board and subject to shareholder approval, the deal values Flybe and its website at only GBP2.8 million. It will bring Europe's largest independent regional airline (Flybe) and the UK's number two long haul airline (Virgin Atlantic) under the Virgin Atlantic brand and combine this business with a specialist in providing third party wet lease regional capacity (Stobart Air).

Connect Airways is 40% owned by Cyrus, 30% by Stobart Group and 30% by Virgin Atlantic. In addition to acquiring Flybe, Connect Airways is also expected to buy Stobart Air from Stobart Group. The combination between Stobart Air and Flybe is easier to understand than that between Virgin Atlantic and Flybe.