Stobart Group has pulled out of talks to buy regional airline Flybe after failing to agree a price for a takeover.
Stobart, which owns Southend airport, admitted last month it was interested in buying Flybe but said it had been “unable to reach agreement on satisfactory terms”.
The announcement sent Flybe’s shares plunging by as much as 25 per cent to around 35p on the London Stock Exchange on Thursday (March 22).
“The board of Stobart Group has determined that it is not in its shareholders' best interests to increase its latest proposal for Flybe above the level which was rejected by the board of Flybe,” said Stobart Group in a statement.
“Given this, Stobart Group confirms that it does not intend to make an offer for Flybe.”
Stobart currently works with Flybe through a franchise arrangement and said it wanted to “continue the collaborative working relationship between both companies”.
Flybe said: “The board remains highly confident in the prospects of Flybe and believes that the group continues to have an exciting future as an independent company, delivering the sustainable business improvement plan as set out in June 2017.
“This plan is focused on driving sustainable profit and cash generation and will see the fleet size reduce to an optimum level for the number of identified profitable routes and make the business demand-driven rather than capacity-led.”