easy and DBA
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Joined: Nov 2001
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From: London Whipsnade Wildlife Park
easy and DBA
Ray Webster, chief executive of easyJet, said he would like to exercise the option easyJet has to buy British Airways' German subsidiary, Deutsche BA, as soon as possible. Webster also said he believes that most budget airlines will have disappeared within two to three years. He said the no-frills airline business is extremely difficult, and operators need the right business model to survive.
Thread Starter
Joined: Nov 2001
Posts: 5,123
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From: London Whipsnade Wildlife Park
Tue 12 Nov 2002
easyJet wants to speed up Deutsche deal
AFX reports easyJet’s chief executive, Ray Webster, would like to exercise the airline’s option to buy British Airways’ German arm, Deutsche BA, as soon as possible.
In May this year, easyJet signed ‘heads of terms’ with BA, under which it was entitled to acquire DBA at any time up to 31 March 2003, in a deal worth between £18.3m and £28m, depending on when the option was exercised.
easyJet was originally expected to sign a buy option with BA by the end of June 2002, but this was postponed while the budget carrier concentrated on its takeover of rival Go.
Webster told German news channel n-tv that the sooner easyJet decided to buy DBA, the sooner it could lower costs.
He also said he believed most budget airlines will have disappeared within 2-3 years, given the ‘extremely difficult’ nature of the sector.
Deutsche BA, meanwhile, has been reaping the benefits of its transformation earlier this year into a true low-cost carrier. Between April-June 2002, the airline carried 800,000 passengers, 14% more than in the corresponding quarter of last year.
easyJet wants to speed up Deutsche deal
AFX reports easyJet’s chief executive, Ray Webster, would like to exercise the airline’s option to buy British Airways’ German arm, Deutsche BA, as soon as possible.
In May this year, easyJet signed ‘heads of terms’ with BA, under which it was entitled to acquire DBA at any time up to 31 March 2003, in a deal worth between £18.3m and £28m, depending on when the option was exercised.
easyJet was originally expected to sign a buy option with BA by the end of June 2002, but this was postponed while the budget carrier concentrated on its takeover of rival Go.
Webster told German news channel n-tv that the sooner easyJet decided to buy DBA, the sooner it could lower costs.
He also said he believed most budget airlines will have disappeared within 2-3 years, given the ‘extremely difficult’ nature of the sector.
Deutsche BA, meanwhile, has been reaping the benefits of its transformation earlier this year into a true low-cost carrier. Between April-June 2002, the airline carried 800,000 passengers, 14% more than in the corresponding quarter of last year.
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Joined: Nov 2001
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From: London Whipsnade Wildlife Park
Mon 10 Feb 2003
easyJet/DBA deal on the rocks
Deutsche BA (DBA) has confirmed a report in today’s FT that its purchase by easyJet is in jeopardy due to the failure of pilots to agree new terms and conditions.
However, easyJet has responded by saying that it is still considering the deal. EasyJet’s option expires on April 30 but it extendable to Aug 3. Before going ahead with the takeover deal, easyJet wants DBA to cut €48m costs and the airline’s pilots to agree to fly 200 more hours a year.
But while many of the German pilots are prepared to accept the changes, the Vereinigung Cockpit union has objected to easyJet’s demands. ‘Cockpit is in a position to mess everything up,’ a DBA spokeswoman told AFX.
In an internal memo from DBA chief Martin Wyatt, seen by FT Deutschland, the airline’s pilots are warned that the easyJet deal is the only way forward.
‘We want to make it very clear to you that DBA has no alternative looming in the background and that a withdrawal of easyJet’s option would seriously endanger every single job at DBA,’ Wyatt told pilots.
Loss-making DBA, which has a workforce of 860 and a fleet of 16 Boeing 737-300s, said last week it would scrap 500 flights in February and March, the equivalent of furloughing two of its aircraft, in response to weak demand.
‘We are forced to adjust capacity,’ Wyatt said Friday. ‘If travel demand doesn’t pick up soon, capacity may be reduced permanently and eventually jobs would be in jeopardy.’
easyJet’s option to take over DBA expires in August. Depending on when the option is exercised, the deal is worth between €30m and €46m.
easyJet/DBA deal on the rocks
Deutsche BA (DBA) has confirmed a report in today’s FT that its purchase by easyJet is in jeopardy due to the failure of pilots to agree new terms and conditions.
However, easyJet has responded by saying that it is still considering the deal. EasyJet’s option expires on April 30 but it extendable to Aug 3. Before going ahead with the takeover deal, easyJet wants DBA to cut €48m costs and the airline’s pilots to agree to fly 200 more hours a year.
But while many of the German pilots are prepared to accept the changes, the Vereinigung Cockpit union has objected to easyJet’s demands. ‘Cockpit is in a position to mess everything up,’ a DBA spokeswoman told AFX.
In an internal memo from DBA chief Martin Wyatt, seen by FT Deutschland, the airline’s pilots are warned that the easyJet deal is the only way forward.
‘We want to make it very clear to you that DBA has no alternative looming in the background and that a withdrawal of easyJet’s option would seriously endanger every single job at DBA,’ Wyatt told pilots.
Loss-making DBA, which has a workforce of 860 and a fleet of 16 Boeing 737-300s, said last week it would scrap 500 flights in February and March, the equivalent of furloughing two of its aircraft, in response to weak demand.
‘We are forced to adjust capacity,’ Wyatt said Friday. ‘If travel demand doesn’t pick up soon, capacity may be reduced permanently and eventually jobs would be in jeopardy.’
easyJet’s option to take over DBA expires in August. Depending on when the option is exercised, the deal is worth between €30m and €46m.
