Stobart takes stake in Aer Arann

TRANSPORT company the Stobart Group has taken a small stake in the troubled Irish airline Aer Arann.

Stobart has taken convertible preference shares in the Dublin-based carrier as part of a deal for it to operate from its airport in Southend, Essex.

Aer Arann entered examinership – an Irish form of administration – in August after posting losses of some £15m over the past two-and-a-half years.

Stobart said the deal was conditional on certain terms being satisfied including the company successfully exiting examinership, which it hopes to achieve by the end of the month.

Aer Arann plans to start operating flights from March and expects to take 300,000 passenger a year. As part of the agreement Stobart said it will spend around £2m promoting the new services.

Andrew Tinkler, Stobart’s chief executive, said: “Although the agreement provides Stobart with a small stake in the form of a convertible preference share in Aer Arann, it does not signal that we are getting into the airline business and we would not be involved in the day-to-day management of Aer Arann – they have a skilled management team in place to do that led by Padraig O’Ceidigh.”

He added: “This is a pragmatic deal that has multiple advantages for the group. Firstly it would guarantee business and volume that will underpin acceleration of our development plans for London Southend Airport. Secondly it will further develop the Stobart business and brand in Ireland. Thirdly the alignment with Aer Arann provides future opportunities for the growing demand for airfreight from our customers.”