Regional airline Flybe – which collapsed earlier this year with the loss of thousands of jobs is set to be revived by a former shareholder, who agrees to a deal to buy the airline out of administration.

The Exeter-based airline could start flying again early next year following the deal agreed with hedge fund firm Cyrus Capital.

Flybe, which flew about 8 million passengers a year between 81 airports in the UK and Europe, had long struggled financially. It was promised fresh investment when a consortium of Virgin, Stobart Air and Cyrus Capital took over the airline in 2019. Virgin Atlantic had planned to rebrand the airline and integrate it as a feeder for its long-haul routes from Manchester and London.

The airline ran into deeper financial trouble in January, with mounting losses prompting it to approach the government to seek emergency financial support. When this wasn’t agreed upon, coupled with the impact of the coronavirus pandemic, the airline collapsed into administration.

But it was announced on Monday morning that subject to certain confidential conditions, this new deal is expected to allow the business to restart operations under the Flybe brand in early 2021.

Administrators said they will work together with Thyme Opco, the company associated with Cyrus Capital who completed the deal, the Flybe management team and the UK Civil Aviation Authority to prepare for the relaunch of the airline’s operations.

Simon Edel, Joint Administrator and EY Turnaround and Restructuring Strategy Partner said: “Today’s announcement, and the upcoming completion of this sale, will be great news to communities around the country that were previously served by Flybe.”