Administrators overseeing the closure of Flybe have played down the likelihood of a third incarnation of the recently failed regional carrier after placing its intellectual property up for sale.
The document – released at the end of March – reveals that joint administrators David Pike and Mike Pink have appointed Hilco Appraisal to market the sale of the company’s intellectual property including its brand, website domain name and social media platforms.
However, it is extremely unlikely that the buyer of these assets would launch a Flybe 3.0 given the events of the last few years and the financial situation administrators are grappling with.
As previously reported, the company was losing around £4-5m each month prior to its demise as a result of “weaker than anticipated trading”, the report said.
According to the document, there was approximately £6.21m in the airline’s bank accounts when it entered administration.
The firm didn’t have many significant assets beyond this because its nine De Havilland Canada Dash 8-400s were leased, namely from NAC and Aergo. The value of its assets available for creditors is set to be £9.42m.
In April 2021, around the time Flybe 2.0 acquired the original incarnation of the carrier, DLP Holdings provided the company with a £20m loan and a revolving credit facility (RCF) of £5m, which was not initially drawn.
In a sign that things weren’t going well, in August 2022 the RCF was increased to £33m, of which £29m had been used by the time the company entered administration.
According to the report, funds were used to set up the business, including for lease deposits, employee costs and other infrastructural and operational matters.
At the date of administration – January 28, 2023 – interest of £1.5m had accrued and remained unpaid on the credit facilities which were secured by fixed and floating charges over company assets.
“They [DLP Holdings] will suffer a shortfall in relation to their indebtedness,” the report said.
However, claims from the company’s employees – of which there were 279 at the time of collapse – for things such as arrears in wages, accrued holiday pay, and pension benefits total around £316,000 and are expected to be paid in full.
Claims from HMRC totalling approximately £360,000 are also expected to be paid in full but these rank second to those made by employees.
Flybe’s trade creditors are owed £8.56m. According to the document, the UK Emissions Trading Scheme and EU261 (EU delayed flight compensation regulation) are the largest single creditors owed £2.23m and £2.39m, respectively.
The estimated total deficiency – the difference between assets and liabilities – for Flybe 2.0 has been calculated to be £82.61m.
Administrators said the most likely exit route from administration will be dissolution.