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Flybe was rescued on Tuesday after its shareholders agreed to
invest more money while the government provided support,
reported to involve the deferral of a tax bill.
Walsh, chief executive of British Airways-owner IAG <ICAG.L> and
one of the biggest names in the industry, criticized the
government support for a privately-held company, saying the
taxpayer was picking up the tab for mismanagement of the
airline.
"This is a blatant misuse of public funds," he said in an
emailed statement.
Walsh and other critics of the Flybe bail-out pointed to the
fact that the carrier's ultimate owners surely had deep enough
pockets to ensure the airline's survival without government
help.
British Airways competes against Flybe on some routes and Flybe
is owned by a group which includes long term BA rival Virgin
Atlantic, plus Stobart Group <STOB.L> and investment adviser
Cyrus Capital.
Virgin Atlantic is 51% owned by Richard Branson's Virgin Group
with the balance held by another BA rival, Delta <DAL.N>, the
second biggest U.S. airline by passenger numbers with a market
capitalization of $40 billion.
Under pressure to deliver on an election promise to help improve
transport links outside London, the government agreed to help
Flybe, in contrast to a similar test last September when it took
no action to help save the much larger travel company Thomas
Cook.
Flybe connects smaller UK cities such as Southampton and
Newcastle and its network of routes includes more than half of
UK domestic flights outside London.
Walsh has also written a letter to Transport Minister Grant
Shapps, said the BBC, outlining his concerns about the Flybe
deal.
(Reporting by Sarah Young; editing by Kate Holton)
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