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Struggling British airline Flybe exploring sale

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Struggling British airline Flybe exploring sale
FILE PHOTO: An airport worker examines a flybe aircraft before it takes off from Liverpool John Lennon Airport in Liverpool northern England, May 19 , 2016. REUTERS/Phil Noble/File Photo   -   Copyright  Phil Noble(Reuters)
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(Reuters) – British regional airline Flybe Group Plc <FLYB.L> said on Wednesday it was in talks to sell itself, as it struggles with higher fuel costs, lower demand and a weaker British pound.

The airline’s stock has lost nearly two-thirds of its value since the company issued a profit warning last month, underscoring challenges faced by rival European airlines including Ryanair Holdings Plc <RYA.I> Wizz Air Holdings Plc <WIZZ.L> and Easyjet Plc <EZJ.L>.

Flybe, which has a market value of 25 million pounds, also said it was looking at other strategic options such as further capacity and cost saving measures.

The company has already reduced its fleet size, focussed on profitable routes and cut costs as it pushes ahead with investments in a new digital platform. It has also been hedging its fuel costs and foreign exchange risks.

Flybe said it was also exploring a possible move to an LSE standard listing, from its current premium listing, saying it would provide the company more flexibility on divestments.

British infrastructure and support services company Stobart Group <STOB.L> scrapped plans to buy Flybe in March after being rebuffed.

Flybe also reported a 49 percent rise in adjusted profit before tax in the first half of the year ending Sept. 30.

The company said forward sales rose in the third quarter, adding that it was now planning to cut second half capacity by around 3 percent.

The company also said it was developing Brexit contingency plans, including potentially reassigning contracts that could be directly affected.

(Reporting by Arathy S Nair and Tanishaa Nadkar in Bengaluru; Editing by Saumyadeb Chakrabarty; Editing by Saumyadeb Chakrabarty)

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