Ex-Flybe shareholders eye legal action against former directors
Former Flybe shareholders are reportedly examining legal action over a cut-price sale of the budget airline in early 2019.
A group of retail investors want to take former directors to court over allegations they put out inaccurate statements, the Mail on Sunday reported.
Shareholders received just 1p per share when the airline was sold in an emergency deal to a Virgin-led group called Connect Airways in early 2019.
Flybe’s stock had been trading at 16.4p per share, valuing it at £36m, the day before the deal was announced.
Shareholders were left with just £2.2m to share, even though the airline raised an additional £2.8m by selling assets.
Connect’s acquisition of the financially troubled airline ended in failure after coronavirus hit bookings and the government refused to hand over a £100m bailout loan.
The Mail on Sunday reported that the former shareholders have hired a law firm to examine a case against ex-directors including former chief executive Christine Ourmieres-Widener and ex-chair Simon Laffin.
“We are exploring the merits of a potential claim by shareholders against the former directors of Flybe for their alleged misconduct and mishandling of the company’s affairs. We are analysing the prospects of recovery and whether the board has insurance,” a spokesperson for the law firm told the Mail on Sunday.
“We will be considering the robustness of the sale process and seeking answers as to how confidential information surrounding terms of the takeover was leaked to the media, which resulted in Flybe having little to no opportunity to mitigate its position.
“The directors could be potentially accountable for any failure to provide accurate and true statements and failing to act in the best interests of the company and shareholders.”
Laffin and Ourmieres-Widener were contacted for comment.