How Carlyle’s bet on unsuccessful Southend airport did not work…
Southend airport, barely used now, is at the centre of an escalating dispute between one of the world’s largest private equity groups and an impoverished infrastructure company. The $426bn investment firm Carlyle Group is demanding the early repayment of a £125mn loan made to the airport in 2021, when the aviation industry was reeling from international travel restrictions due to Covid. Carlyle says it has made multiple attempts to resolve the conflict with Southend airport’s London-listed owner, Esken, and that the airport has breached the terms of the loan on multiple occasions. Known as Stobart Group until a rebranding in 2021, Esken emerged in 2007. Among its first deals was the bet on Southend Airport, which it bought in a 2008 agreement worth around £21mn. The airport was doing reasonably well until Covid, but then cash-strapped airlines consolidated around larger hubs, every airline left. It cannot attract airlines. Nor can Esken’s other airport, Carlisle. Esken wants to sell Southend and repay shareholders. Southend was never likely to succeed in getting many passengers. . Tweet How a US buyout giant’s bet on an empty London airport turned sour By Philip Georgiadis and Will Louch in London and Euan Healy in Southend (FT) 10.2.2024 Carlyle is pursuing the owner of London Southend through the courts over a £125mn loan Southend was once hailed as the UK capital’s fastest-growing airport, processing more than 2mn passengers a year. Then the pandemic struck On a rain-lashed Thursday afternoon in early February, the departure lounge at Southend Airport is empty. There are just two flights taking off from the terminal 36 miles east of central London that once aspired to break into the top tier of British aviation. Away from the tarmac, the near-deserted site in Essex is at the centre of an escalating dispute between one of the world’s largest private equity groups and a penny stock infrastructure company. The $426bn investment firm Carlyle Group is demanding the early repayment of a £125mn l
