Business secretary Andrea Leadsom said the government had reached an agreement to keep troubled airline Flybe operating.
Ms Leadsom said that the decision would be “welcome news” for staff, customers, and creditors – after 48 hours of uncertainty during which it sought to stave off collapse.
Sky News understands that the deal was likely to involve some deferral of air passenger duty for Flybe.
There would also be a review, in March’s Budget, of the way the tax is applied to domestic talks – plus further talks about a government loan, and an investor cash injection for Flybe.
Ms Leadsom said on Twitter: “Delighted that we have reached agreement with Flybe’s shareholders to keep the company operating, ensuring that UK regions remain connected.
“This will be welcome news for Flybe’s staff, customers and creditors and we will continue the hard work to ensure a sustainable future.”
Transport secretary Grant Shapps also welcomed the announcement.
He said: “Delighted we’ve been able to work closely with Flybe to ensure Europe’s largest regional airline is able to continue connecting communities across Britain.”
Mr Shapps added that the Department for Transport would launch an “urgent review into how we can level up the country by strengthening regional connectivity”.
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