Flybe in crisis talks with government to stave off collapse
Struggling airline Flybe is reportedly locked in last ditch talks with the government to defer its multi-million pound air passenger duty (APD) bill as it teeters on the brink of collapse.
The airline has asked Whitehall to help it find a way of delaying its APD payments while it struggles with cash flow in the winter months, Sky News reported.
Flybe reportedly faces an annual APD bill running to tens of millions of pounds.
Read more: What do we know so far about Flybe’s ‘near collapse’
The airline could call in administrators as soon as tomorrow if the government does not agree to the deferral, the report said.
Sky cited sources who said the issue of deferring payments was part of a suite of measures under discussion between Flybe’s owner Connect Airways and the government.
The cash crunch was triggered after two of Connect’s shareholders – Southend Airport-owner Stobart Group and hedge fund Cyrus Capital Partners – expressed reservations about a plan to inject £100m into Flybe in the coming year, the report said.
Accountancy firm EY has been put on standby to deal with a potential administration, Sky reported last night.
Read more: Troubled airline Flybe insists flights continue as normal amid survival funding talks
A spokesperson for Flybe said: “Flybe continues to provide great service and connectivity for our customers while ensuring they can continue to travel as planned. We don’t comment on rumour or speculation.”
A spokesperson for the Department for Business, Energy and Industrial Strategy, said: “We do not comment on speculation or the financial affairs of private companies.”