The website for the would-be new owners of the Monarch Group doesn’t give much away. On the page are two paragraphs of text describing the company and an email address.
“We’ve done a poor job of communicating what we do,” Marc Meyohas, founder and managing partner of Greybull Capital, told TTG.
He denied that the firm was secretive, pointing out that it didn’t need a huge public profile as it is a “family office” so did not need to raise external capital.
The firm was part of a group of investors behind OpCapita’s ill-fated buyout of Comet and has also backed a number of other companies, including electronics business Plessey Semiconductors.
“We were not a relevant player in what happened with Comet. We got a disproportionate amount of PR flak for it but that’s probably because we are not particularly good at managing our PR activities, we’re trying to get better at it.”
So if Greybull does take control, what next? The deal is set to go through at the end of October pending the “successful outcome of ongoing negotiations”, and the firm’s investment is likely to be more than £75 million.
Monarch’s struggles over the summer have been well documented and it released a statement admitting that it was undergoing a strategic review covering all areas of the business from “operations to ownership and financing”.
“Clearly the current shareholder [the Swiss-based Mantegazza family] after 46 years has made the decision that now’s the time to step aside and the business needs to change direction significantly,” said Monarch chief executive Andrew Swaffield.
This will include a reduction in its cost base to bring it in line with other low-cost carriers such as easyJet and Ryanair.
"One of the first comments I made when I started the job was that we had too many planes chasing too few passengers"
There are also set to be around 900 job losses as well as pay cuts and changes to terms and conditions. Currently Monarch employs around 3,300 people.
Swaffield said that unions and employees had backed the changes. “They’ve all been extremely supportive through a very difficult process,” he said.
The company’s airline will cut its capacity by around 34% when it starts its summer 2015 season. Up to 10 aircraft will also be returned.
Swaffield admitted that most of the company’s problems stemmed from the airline. He said the tour operating division, which includes Cosmos Holidays, and the engineering unit had been doing “fairly steadily well”.
Monarch’s problems are not just internal and like other airlines and travel firms it has had to try to compete in a crowded marketplace.
“It was one of the first comments that I made when I started the job in April, that it was clear we had too many aeroplanes chasing too few passengers,” he said.
Swaffield said he expected the year-end losses to be “very significant” but would not be drawn on Monarch’s pension fund deficit, which stands at around £158 million.