Virgin Atlantic in talks to buy ailing Flybe

Shares in ailing regional carrier Flybe were well above cruising altitude on Friday, as it confirmed it was in talks with long-haul airline Virgin Atlantic, which was considering a take over of the Exeter-based firm.

The two firms said Virgin Atlantic had begun talks with Flybe’s advisers about making a bid for the London-listed firm.

Such a move would mark a return to domestic flying for Virgin, which shuttered its ‘Little Red’ operation four years ago.

Little Red was an attempt by Virgin to break the British Airways stranglehold on full service domestic carriage, using slots the latter was forced to abandon when it took over bmi.

It was understood on Friday morning that Virgin Atlantic was looking to utilise Flybe’s regional routes as feeders to its long-haul services.

The two airlines already codeshare on flights out of Heathrow and Manchester.

Flybe, which has suffered from a general downturn in the aviation market as well as rising oil prices in recent months, put itself up for sale in an announcement last week.