This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. For an explanation of our Advertising Policy, visit this page.

Virgin Atlantic is coming to the rescue of a large regional airline in the UK with plans to build out its regional fleet and route network.

Virgin has partnered with Stobart Group and Cyrus to purchase Flybe for £2.2 million in a cut price deal. The three companies will form a joint venture, Connect Airways, to manage the new airline. Flybe’s stock dropped by 90% today after Flybe recommended shareholders take the £2.2 million deal — a far cry from the £300 million the airline was valued at less than five years ago

The Exeter-based carrier has faced financial troubles for the last few years after a failed takeover of another airline, rising fuel prices and Brexit uncertainty. The airline put itself up for sale in November after things became more dire.

Flybe is a regional airline that has a sizable fleet of 78 aircraft including turbprop ATRs and Bombardier Dash 8s in addition to a handful of Embraer E-Jets.

EXETER, ENGLAND - OCTOBER 18: A aircraft operated by the airline Flybe, taxis down the runway at Exeter Airport near Exeter on October 18, 2018 in Devon, England. The value of shares in the Exeter-based airline Flybe, have fallen dramatically recently after the company issued another profit warning, blaming poor demand, a weaker pound and higher fuel costs.(Photo by Matt Cardy/Getty Images)
The value of shares in the Exeter-based airline Flybe, have fallen dramatically recently after the company issued another profit warning, blaming poor demand, a weaker pound and higher fuel costs. (Photo by Matt Cardy/Getty Images)

All Flybe aircraft will fly under the Virgin brand and be repainted in the airline’s signature red and white colors — the acquisition will nearly triple the size of Virgin Atlantic’s fleet, which only consists of 47 widebody Airbus and Boeing aircraft.

Flybe carries around 8 million passengers a year and flies to destinations around the UK, Ireland and continental Europe. Virgin primarily flies to long-haul destinations from its London and Manchester hubs, so the acquisition of Flybe will help it build out a network of regional flights and could provide connecting traffic to its long-haul operations.

This is good news for points and miles collectors, as it’s all but certain that passengers will be able to earn and redeem Virgin Atlantic miles and enjoy elite status benefits on flights formerly operated by Flybe aircraft. Virgin miles are currently valued at 1.5 cents apiece by TPG and the program has some great sweet spots with partners like ANA and Delta.

Virgin Atlantic, which is still part owned by its billionaire founder Richard Branson, attempted to enter the regional market in 2013 with the airline Virgin Atlantic Little Red, however its run was short lived and the airline shuttered in 2015.

Virgin Atlantic is quickly growing. Last May, Air France-KLM and Delta signed an agreement with Virgin to strengthen a joint venture and help create an even larger network for the airlines that was already quite massive. The Stobart Group, which will also take an ownership stake in Flybe, owns regional Irish airline Stobart Air and has said it wants to increase flights out of the two airports it owns, including London’s Southend (SEN).

Featured image by Nicolas Economou/NurPhoto via Getty Images.

Know before you go.

News and deals straight to your inbox every day.

The best beginner points and miles card out there.
Chase Sapphire Preferred® Card

NEW INCREASED OFFER: 60,000 points! With great travel benefits, 2x points on travel & dining and a 60,000 point sign up bonus worth up to $1,200 in value, the Chase Sapphire Preferred is a great card for those looking to get into the points and miles game. Here are the top 5 reasons it should be in your wallet, or read our definitive review for more details.

Apply Now
More Things to Know
  • Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $750 toward travel when you redeem through Chase Ultimate Rewards®
  • Chase Sapphire Preferred named "Best Credit Card for Flexible Travel Redemption" - Kiplinger's Personal Finance, June 2018
  • 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
  • No foreign transaction fees
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 60,000 points are worth $750 toward travel
  • No blackout dates or travel restrictions - as long as there's a seat on the flight, you can book it through Chase Ultimate Rewards
Intro APR on Purchases
N/A
Regular APR
18.24% - 25.24% Variable
Annual Fee
$95
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent Credit

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.