(Reuters) - British regional airline Flybe Group Plc <FLYB.L> is said to explore a sale or a merger with a rival, Sky News reported on Tuesday, weeks after it issued a profit warning because of fuel costs, weakening demand and a weaker British pound.
Stobart Group Ltd <STOB.L>, which has previously bid for Flybe, is likely to be one of the potential suitors, Sky News said. It said the airline would make an announcement on Wednesday.
Flybe declined to comment on the Sky News report.
Earlier this year, Stobart had abandoned its plans to buy the airline after the bid was rejected.
Bankers at Evercore have been brought in to handle talks about a potential deal, the report said.
Brexit-related uncertainty, weaker British pound and rising fuel costs led the airline's directors to conclude that a takeover was likely to be required to preserve its future, the report said, citing sources.
(Reporting by Shubham Kalia in Bengaluru; editing by Grant McCool)
