Esken days away from £120m Southend Airport deal

Esken days away from £120m Southend Airport deal
Esken pulled the plug on Stobart Air earlier this month.

The company behind Southend Airport is closing in on a £120 million deal that will help develop the site, weeks after it pushed Stobart Air into administration.

Esken said that US private equity firm Carlyle is seeking final approvals for a deal that could come “in the coming days”.

It will see Carlyle lend £120 million to Esken, which can be converted into a 30% stake in the airport.

Carlyle Global Infrastructure managing director Richard Hoskins said: “We have been in detailed discussions with Esken for a number of months and are seeking final approvals to sign definitive transaction documents in the coming days that will allow us to work in partnership with Esken to develop London Southend Airport.”

Esken, formerly Stobart Group, has been more challenged than most during the pandemic.

The travel firm made a loss of more than £150 million in the year to February 28 it reported on Wednesday.

Three weeks ago it was forced to push Stobart Air, which operated Aer Lingus’s regional flights, into administration after a deal for the business fell through.

It said that it expects to see cash outflow costs from the liquidation and the leases it still has on planes to reach £82 million over the next three years.

However Esken hopes to reduce these costs by finding someone to take the planes off its hands.

Its executive chairman David Shearer said: “We responded robustly and decisively, minimising losses, reducing cash burn and protecting liquidity to maintain the operational capability of our core businesses.

“Passenger travel has been severely disrupted by lockdowns and evolving quarantine arrangements.

“London Southend Airport (LSA) has not only withstood the impact of the pandemic but has provided an essential service through its global logistics operation.

“Its low-cost base proposition will position us well for a post pandemic recovery.”

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