14th Jun 2021 15:47
(Alliance News) - Esken Ltd - formerly known as Stobart Group Ltd - on Monday confirmed that it is in the final stages of agreeing the documentation with Carlyle Global Infrastructure Opportunity Fund for a funding deal into the development of London Southend Airport.
Carlyle Global Infrastructure Opportunity Fund is a private equity fund managed by Washington DC-based fund manager Carlyle Group.
Under the proposed deal, Carlyle will provide GBP120 million through a loan, which would release GBP100 million of liquidity into the rest of the Esken.
The loan is convertible at Carlyle's option into an equity stake of 30% in London Southend Airport.
Earlier, Esken announced that its subsidiary Stobart Air has ceased trading and has taken steps to appoint a liquidator.
Esken back in April had agreed to sell Stobart Air to Isle of Man-based Ettyl for a nominal GBP2, plus up to GBP7.5 million by 2024 depending on performance. Late last month, Esken first said the sale was delayed as it awaited change of control consents that would have allowed Stobart Air to keep its contracts under the new ownership. Then it said it had become aware that Ettyl's proposed financing was no longer available and that Ettyl was in discussions with another potential financing source.
However, "it is now clear" Ettyl is unable to conclude the deal on the original terms or obtain an alternative funding package within the required timeframe, Esken said on Saturday. Therefore, Esken has terminated the sale and advised the Stobart Air board it will not continue to provide financial support to the business.
"As a result of this the board of SA has terminated its franchise agreement with Aer Lingus, will cease trading and is taking steps to appoint a liquidator," said Esken.
Shares in Esken were down 6.4% at 29.00 pence in London on Monday afternoon, after falling to a low of 23.05p
By Dayo Laniyan; [email protected]
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