One Euro to Be the Majority Shareholder of an Airline?
“F lybe and Finnair have agreed to restructure the ownership of their jointly owned Flybe Nordic venture, and Flybe has agreed to sell the shares that it holds in Flybe Nordic to a potential new majority shareholder or to Finnair for the price of one euro.”
This is the first paragraph of an article posted at the official Internet web site of the Aviation Tribune; but you may not want to jump on this offer of possibly owning up to 60 percent of Flybe Nordic, as there is a reason why Flybe and Finnair reportedly signed a conditional agreement — subject to approval by competition authorities — in which Flybe will exit the Flybe Nordic joint venture by the end of 2014.
Flybe Nordic is currently undergoing “profitability issues” which need to be resolved — to the tune of millions of euros.
Despite significant financial problems, Flybe Finland — the regional airline subsidiary of Finnair which is owned by Flybe Nordic — will continue to operate as usual.
This seems to be like those offers where you can purchase a house for one dollar — only to have the cost of repairing and restoring that home exceed the typical price of a comparable house.
A quote attributed to Richard Branson states that “If you want to be a millionaire, start with a billion dollars and launch a new airline.” Apparently Flybe Nordic is no exception…
…and if you are interested in becoming the majority shareholder in Flybe Nordic, be prepared to have deep pockets to invest into it one you have purchased it…