EUJet future in doubt?

The future of Planestation, the company that operates Kent International airport and owns a share of EUjet was called into doubt after its share value plummeted. The shares dropped from over 40 pence to 17.5 pence at the end of last week following an announcement by Planestation that it needed to raise £22 million to fund EUjet, the Irish no-frills airline run by former Ryanair chief executive PJ McGoldrick. The reason for the drop in shares, once valued at over 600 pence, was an announcement by the company that it needed to raise £22 million from investors largely to fund EUjet, in which it took a 30% stake in May 2004 at a cost of £2 million. The announcement came as Planestation posted losses of £6.5 million for the six months to September and attributed £1.3 million of this loss to EUjet. Planestation also operates airports in Majorca, Germany and Florida. Its directors have secured an overdraft facility from the Bank of Scotland but need longer term financing which it hopes to raise through equity financing. According to a report in the Daily Telegraph newspaper, Planestation chief executive, Martin May blamed the negative reaction to the news on a lack of understanding of “the dynamics of this business”. The Daily Telegraph report claims the news calls into question the future of Planestation. An EGM is being held at the end of the month.