Esken Ltd (LON:ESKN) said it expects to seek final approvals for a £120mln cash injection into London Southend Airport (LSA) by private equity group Carlyle within a couple of days.
The group added it is also in talks with its banks over a new £20mln working capital facility and shareholders over a possible £40mln equity raise.
Major shareholder Toscafund, with a 28.7% stake, will support an equity raise, Esken said.
Added to the Carlyle injection, the additional capital would enable all outstanding bank debt to be repaid and underpin the business plan going forward, Esken said in a statement.
Carlyle’s loans will be apportioned £100mln for the group with £20mln ringfenced for LSA. If converted, they would give the private equity group a 29.99% stake in the airport.
Esken posted a loss of £150.3mln (£139.4mln) in the year to 28 February 2021, which included impairments of £88.3mln for the now shut Stobart Air and leasing firm Propius.
Revenue during the year fell by 22% to £111mln while underlying profits in the ongoing aviation and energy arms fell to £3.9mln from £14.3mln.
David Shearer, executive chairman, said passenger travel had been severely disrupted by lockdowns and evolving quarantine arrangements but Southend Airport had responded well.
“London Southend Airport (LSA) has not only withstood the impact of the pandemic but has provided an essential service through its global logistics operation. Its low-cost base proposition will position us well for a post-pandemic recovery.
“Encouragingly Stobart Energy's margins have been recovering in the first half of FY2022 and gate fees are now improving toward pre-COVID-19 levels.”