THE “financially distressed” owner of Southend Airport is locked in a legal row over demands to urgently repay a near £200million loan.

The Carlyle Group Infrastructure fund – managed by the US asset management giant – has taken legal action against Esken, which owns the airport, over alleged breaches of the terms of the huge loan.

Now, the Carlyle Group want the £193.75million loan to be repaid by February 16, claiming it can “no longer wait patiently”.

The group has claimed Esken – which put the airport up for sale in June 2023 – is “not in a position to support the airport’s recovery” and that Carlyle is “committed to the future of the airport”

The agreement was made in 2021 to help fund the development of Southend Airport, and has a maturity date of August 2028.

Esken has hit back at the firm, saying it is “disappointed” and is confident it has a robust defence to Caryle’s claims, adding that there have been no payment defaults by Southend Airport.

A spokesman for Carlyle said: “Esken is financially distressed and is not in a position to support the airport’s full recovery and growth nor execute an orderly sale of the airport.

“As an experienced investor in and operator of airports around the world Carlyle believes in, and is committed to, the future of Southend Airport and understands its importance to airlines, passengers, employees and the local community.

“We have made numerous proposals to Esken and the airport to secure the airport’s long-term future, and look forward to stable ownership of the airport by an experienced and financially strong entity.”

The loan could be transformed into a 30 per equity stake under certain conditions. Carlyle already operates a number of other global airports including the new terminal one at New York’s JFK.

Esken has insisted it is business as usual at Southend.

A spokesman for Esken said: “Southend Airport is an attractive strategic airport asset as aviation markets continue to recover from the unprecedented effects of the Covid-19 pandemic. The board of Esken believes that there is considerable value in the business and continues to support its liquidity needs in line with the recovery plan. It is focused on securing the right long-term partner for the airport.”