Carlyle to inject £120mln into Southend Airport

Esken Limited the owner of Southend Airport is in late-stage talks about a cash injection from private equity firm Carlyle.

The group announced the closure of Stobart Air at the weekend after a planned sale fell through but said today it was in talks with an unnamed investor over an injection of funds.

The group later confirmed that the investor is Carlyle, which is set to take a 30% stake in the airport through the issue of a convertible bond that would convert into equity over a period of several years.

In a statement, Esken said it is the final stages of agreeing the documentation with Carlyle Global Infrastructure Opportunity Fund with regards to a long term strategic funding transaction relating to the development of LSA.

“Under the proposed terms of the partnership, Carlyle would provide £120mln of funding net of Carlyle costs via a loan (convertible at Carlyle’s option into an equity stake of 29.99% in LSA), which would release £100m of liquidity into the rest of the Group.”

Southend Airport is used by Ryanair and WizzAir but was one of the airports cut when EasyJet retrenched last year.

In its statement this morning Esken said that the financing talks are in the final stages, adding it would release significant liquidity for the group.

Details are expected with the full-year results later this month and Esken said this funding would allow it to clear its outstanding bank debt of £120mln.

Source: Proactive Investors