US private equity firm Carlyle’s Global Infrastructure Opportunity Fund will acquire an 82.5% stake in London Southend Airport, a subsidiary of aviation group Esken, formerly Stobart Group, in an agreement to settle £193.75m in debt, with London-based private equity firm Cyrus Capital Partners providing liquidity to Esken.
According to a statement published by Esken on the London Stock Exchange (LSE), the group will retain a 17.5% stake as part of the deal, though its shares will be delisted from the LSE and shareholders will not receive any returns.
Esken said: “The expectation is that any return for shareholders at the end of the process is likely to be negligible.”
The deal was agreed with the airport’s board and includes £5m of short-term unsecured bridge funding as part of a commitment of £32m of new funding “to secure the future growth of the airport”. The statement also reveals that Cyrus holds a £53.1m exchangeable bond which matures on 8 May 2024.
According to a report by The Guardian, the deal settles a dispute beginning in 2021, when Esken borrowed £125m from Carlyle to secure its finances through a pandemic-induced travel crisis. The latter later claimed that Esken had broken the terms of its loan and asked for a £200m repayment.
