Carlisle-based aviation and energy firm Stobart Group said on Monday it agreed to buy back regional airline Stobart Air and its leasing firm Propius for up to £8.55 million from Ernst & Young, the administrators of Connect Airways.

Stobart Group sold the regional airline in 2019 to Connect Airways, the owner of the collapsed regional airline Flybe.

Stobart Group CEO Warwick Brady said: “This transaction allows Stobart Group to take control of the outstanding legacy issues which date back to 2017 when Stobart Air and Propius became subsidiaries of the company.

“The original strategy to mitigate these issues over time through the combination of the businesses with Connect was impacted by the failure of Flybe and resulting administration of Connect in March 2020.

“We believe that Stobart Air has a viable future after COVID-19 and are working with Aer Lingus as our franchise partner to place the business on a secure footing and manage the impact of the legacy obligations in a controlled manner.”