UK’s Stobart Group: negotiating a stake in London's Southend Airport

It might appear to be a strange time to be negotiating the sale of equity in an airport, but discussions between the Stobart Group and AviAlliance to that end over Southend Airport appear to have been progressing for some time. The deal could be worth up to GBP800 million.

The FTSE 250 Stobart Group encompasses road freight, rail and air transport. The group also has an interest in Carlisle Airport and Teesside Airport in northeast England, where it holds a 25% stake and a management contract. Stobart is in a difficult period, owing to liabilities arising from the collapse of the airline Flybe, in which it held a 30% stake.

Southend was once one of the UK's busiest airports. Essex is a heavily populated county (1.5 million) to the east of London and a rail link directly to and from the airport means that it can be considered as an alternative airport to London City and London Stansted airports for those living in the east of London, and even in the centre.

The smallest of the London airports seems to be an obscure interest for the German company, but recent events highlighting the diminishing prospect of additional runways in London make Southend look like an enticing prospect.