Aer Lingus is to cut ties with Stobart Air after confirming it will find a new operator for its regional services from the start of 2023.
The decision is a blow to Stobart Group's bid to find a buyer for the Irish air operation, which provides flights from Dublin, Cork, Shannon, Donegal and Kerry across 43 routes in 11 European countries.
Stobart Group CEO Warwick Brady described the decision by Aer Lingus as disappointing but said the operation remained a “strategic and attractive“ asset for a potential buyer after eight years of flying between Ireland and the UK.
Stobart, whose core operations are focused on Southend Airport and an energy-from-waste business, has a contract with Aer Lingus that runs until the end of 2022.
It remains in discussions with a number of parties and said it hopes to agree its exit from Stobart Air by the end of February.
The operation has a valuable portfolio of airport slots, although interim results this month revealed that the outlook for Stobart Air had deteriorated significantly due to continued quarantine arrangements in Ireland. Most of the fleet is currently grounded, placing a significant cash strain on the business due to ongoing lease agreements on aircraft.
Emerald Airlines has emerged as the frontrunner to secure the new ten-year contract from Aer Lingus, which is part of BA owner International Airlines Group.
