EasyJet Acquisition of Go confirmed
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EasyJet Acquisition of Go confirmed
From the BBC...
Easyjet agrees deal to buy Go
The low-cost airline, Easyjet, has announced that it's buying its rival Go for £374m.
The chairman of Easyjet, Stelios Haji-Ioannou, said: "This is one of the most exciting developments in Easyjet's history.
The airline announced earlier this month that it was in talks with its rival about a possible takeover.
The chief executive of Go, Barbara Cassani, had made it clear she was not happy with the proposed deal.
But in a statement she said the acquisition was a tremendous compliment to everyone at Go.
More soon
Easyjet agrees deal to buy Go
The low-cost airline, Easyjet, has announced that it's buying its rival Go for £374m.
The chairman of Easyjet, Stelios Haji-Ioannou, said: "This is one of the most exciting developments in Easyjet's history.
The airline announced earlier this month that it was in talks with its rival about a possible takeover.
The chief executive of Go, Barbara Cassani, had made it clear she was not happy with the proposed deal.
But in a statement she said the acquisition was a tremendous compliment to everyone at Go.
More soon
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London, May 16 (Bloomberg) -- EasyJet Plc said it agreed to buy Go Fly Ltd., Europe's No. 3 no-frills carrier, to add routes, aircraft and passengers and overtake Ryanair Holdings Plc as Europe's biggest low-fare airline.
Luton, England-based EasyJet said it will buy Go for 375 million pounds ($547 million). Analysts had expected it to pay between $585 million and $878 million for the closely held carrier, which is controlled by 3i Group Plc venture-capital investment company.
The takeover "offers the potential to create substantial value for our shareholders,'' Chairman Stelios Haji-Ioannou said in a statement released on Regulatory News Service.
EasyJet has been growing by adding routes at airports such as London Gatwick and winning budget-conscious travelers from full- service rivals such as British Airways Plc. It also has a one-year option to buy British Airways' unprofitable Deutsche BA unit for at least 44 million euros ($40 million).
EasyJet also said today it will raise 276.7 million pounds in a share sale to current investors.
The carrier's shares fell as much as 30 pence, or 6.5 percent, to 430p.
Go Fly's profit from operations more than quadrupled to 17 million pounds in the year ended March 31 while sales rose 46 percent to 233.7 million pounds. Go Fly's passenger count in the fiscal year ended March 31 rose 55 percent to 4.27 million. That compares with EasyJet's passenger count of 7.1 million in the year ended Sept. 30.
Go has net cash of 116.4 million pounds, EasyJet said today.
Luton, England-based EasyJet said it will buy Go for 375 million pounds ($547 million). Analysts had expected it to pay between $585 million and $878 million for the closely held carrier, which is controlled by 3i Group Plc venture-capital investment company.
The takeover "offers the potential to create substantial value for our shareholders,'' Chairman Stelios Haji-Ioannou said in a statement released on Regulatory News Service.
EasyJet has been growing by adding routes at airports such as London Gatwick and winning budget-conscious travelers from full- service rivals such as British Airways Plc. It also has a one-year option to buy British Airways' unprofitable Deutsche BA unit for at least 44 million euros ($40 million).
EasyJet also said today it will raise 276.7 million pounds in a share sale to current investors.
The carrier's shares fell as much as 30 pence, or 6.5 percent, to 430p.
Go Fly's profit from operations more than quadrupled to 17 million pounds in the year ended March 31 while sales rose 46 percent to 233.7 million pounds. Go Fly's passenger count in the fiscal year ended March 31 rose 55 percent to 4.27 million. That compares with EasyJet's passenger count of 7.1 million in the year ended Sept. 30.
Go has net cash of 116.4 million pounds, EasyJet said today.
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BA wont profit, it doosn't own any of GO anymore.
From the FT
EasyJet reaches agreement to buy Go for £374m
By Kevin Done, Aerospace Correspondent
Published: May 16 2002 09:11 | Last Updated: May 16 2002 09:25
EasyJet has entered into a conditional agreement to take over Go, its smaller rival, in a deal that will create Europe’s largest low-cost airline.
It is paying £374m ($546.4m) to take over the entire share capital of Go and certain loans and obligations.
It is planning to finance the deal partly through a £276.7m four for 11 rights issue at a deeply discounted price of 265p per share compared with Wednesday night’s closing price of 460p.
EasyJet said a further £113.3m would be financed from the enlarged group’s cash resources.
The group said that the deal gave Go an enterprise value of £257.6m after taking account of £116.4m of net cash on the Go balance sheet at the end of March.
The sale of Go is likely to create around 20 overnight millionaires from the group of Go senior executives and managers, who participated in the £110m management buy-out from British Airways in June last year.
As part of the sale last year 22.5 per cent of the Go equity was earmarked for ownership by current and future employees.
The sale is a financial coup for 3i, the UK venture capital group, which with allied funds has controlled a 67.5 per cent stake in Go and supported the management buy-out less than a year ago. Barclays Private Equity held the remaining 10 per cent.
The biggest personal financial winner in the deal is Barbara Cassani, Go’s American chief executive who holds a four per cent stake in the airline.
Ms Cassani has consistently opposed the sale since 3i began disposal talks with EasyJet in February, however, claiming that the future of Go "would be best served" by an initial public offering that would have allowed it to maintain its independence rather than it being taken over in a trade sale to its arch rival.
Ray Webster, chief executive of EasyJet, will remain as CEO of the enlarged group, and Ms Cassani has already stated that she does not want to be part of the combined business "in any capacity". She said last week that it was her intention to leave the business on completion of the negotiations.
The Go brand will eventually disappear as the two airlines are merged.
The takeover will mean that EasyJet will have a significant presence at three London airports, Luton, Gatwick and now Stansted, where it will move into head-to-head competition with Ryanair, hitherto the clear leader of the no frills sector.
EasyJet and Go are relative newcomers to the European aviation industry. EasyJet began flying in 1995 and Go in 1998, but both are already posing a growing competitive challenge to the traditional European flag carriers.
Go, which is headquartered at Stansted and also has UK bases at Bristol and East Midlands airports, carried 4.27m passengers in the 12 months to the end of March, a rise of 55 per cent. It is operating on 39 routes to 24 airports with a fleet of 25 Boeing 737-300s.
EasyJet carried 8.25m passengers in the 12 months to the end of March behind the 11.09m of Ryanair. It is serving 45 routes from 19 airports this summer with bases at Luton, Liverpool and Gatwick in the UK and at Amsterdam and Geneva in continental Europe. It had a fleet of 30 aircraft at the end of March, which is expected to grow to 36 by the end of September.
The takeover of Go is only the first step in EasyJet’s planned growth through acquisition. Last week it said that it was also taking an option to acquire Deutsche BA, the loss-making German domestic airline from British Airways by July next year.
Concerns have already been expressed by financial analysts that EasyJet would be seriously overstretching its management resources by taking over both airlines.
From the FT
EasyJet reaches agreement to buy Go for £374m
By Kevin Done, Aerospace Correspondent
Published: May 16 2002 09:11 | Last Updated: May 16 2002 09:25
EasyJet has entered into a conditional agreement to take over Go, its smaller rival, in a deal that will create Europe’s largest low-cost airline.
It is paying £374m ($546.4m) to take over the entire share capital of Go and certain loans and obligations.
It is planning to finance the deal partly through a £276.7m four for 11 rights issue at a deeply discounted price of 265p per share compared with Wednesday night’s closing price of 460p.
EasyJet said a further £113.3m would be financed from the enlarged group’s cash resources.
The group said that the deal gave Go an enterprise value of £257.6m after taking account of £116.4m of net cash on the Go balance sheet at the end of March.
The sale of Go is likely to create around 20 overnight millionaires from the group of Go senior executives and managers, who participated in the £110m management buy-out from British Airways in June last year.
As part of the sale last year 22.5 per cent of the Go equity was earmarked for ownership by current and future employees.
The sale is a financial coup for 3i, the UK venture capital group, which with allied funds has controlled a 67.5 per cent stake in Go and supported the management buy-out less than a year ago. Barclays Private Equity held the remaining 10 per cent.
The biggest personal financial winner in the deal is Barbara Cassani, Go’s American chief executive who holds a four per cent stake in the airline.
Ms Cassani has consistently opposed the sale since 3i began disposal talks with EasyJet in February, however, claiming that the future of Go "would be best served" by an initial public offering that would have allowed it to maintain its independence rather than it being taken over in a trade sale to its arch rival.
Ray Webster, chief executive of EasyJet, will remain as CEO of the enlarged group, and Ms Cassani has already stated that she does not want to be part of the combined business "in any capacity". She said last week that it was her intention to leave the business on completion of the negotiations.
The Go brand will eventually disappear as the two airlines are merged.
The takeover will mean that EasyJet will have a significant presence at three London airports, Luton, Gatwick and now Stansted, where it will move into head-to-head competition with Ryanair, hitherto the clear leader of the no frills sector.
EasyJet and Go are relative newcomers to the European aviation industry. EasyJet began flying in 1995 and Go in 1998, but both are already posing a growing competitive challenge to the traditional European flag carriers.
Go, which is headquartered at Stansted and also has UK bases at Bristol and East Midlands airports, carried 4.27m passengers in the 12 months to the end of March, a rise of 55 per cent. It is operating on 39 routes to 24 airports with a fleet of 25 Boeing 737-300s.
EasyJet carried 8.25m passengers in the 12 months to the end of March behind the 11.09m of Ryanair. It is serving 45 routes from 19 airports this summer with bases at Luton, Liverpool and Gatwick in the UK and at Amsterdam and Geneva in continental Europe. It had a fleet of 30 aircraft at the end of March, which is expected to grow to 36 by the end of September.
The takeover of Go is only the first step in EasyJet’s planned growth through acquisition. Last week it said that it was also taking an option to acquire Deutsche BA, the loss-making German domestic airline from British Airways by July next year.
Concerns have already been expressed by financial analysts that EasyJet would be seriously overstretching its management resources by taking over both airlines.
Keeping Danny in Sandwiches
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Just a thought £250m net for an airline without any route rights and old 737's on Operating leases (like renting a car from Hertz: or in this case the local second hand car lot)?
The only assets must be the staff so now you know how much the city thinks you are worth. When are we going to wake up to our real value.
Go without its pilots is worth nothing.
The only assets must be the staff so now you know how much the city thinks you are worth. When are we going to wake up to our real value.
Go without its pilots is worth nothing.
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Engee73: There was a clause written into the deal between BA and 3i, that means if they sell GO within 10 years (i think!), then BA will receive a share of the resale value. I understand they will receive about £20 million.
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Hudson Bay:
And just how tatty are your (Jersey European/BEA/FlyBE - whatever) BAe146's these days?
Half your companies aircraft can't agree on a livery. Your website is up and down like a whores draws. Your miniscule marketing budget runs cinema adds for routes you dropped months ago.
You lost £10m last year and if you do the same this year you face closure. You have no answer to the low cost invasion. Don't be bitter. I am sure easyJet will have place for you in a nice new Boeing NG. Much more civilized than bouncing about in a Dash8, cramming yourseld into a CRJ or dragging around in a 146...
Go is worth £374m because thats what it cost in the market this morning. How much is BEA worth I wonder..?!?
£374 million for a fleet of tatty aircraft and a couple of porta cabins! Sounds like a massive sum of money.
And just how tatty are your (Jersey European/BEA/FlyBE - whatever) BAe146's these days?
Half your companies aircraft can't agree on a livery. Your website is up and down like a whores draws. Your miniscule marketing budget runs cinema adds for routes you dropped months ago.
You lost £10m last year and if you do the same this year you face closure. You have no answer to the low cost invasion. Don't be bitter. I am sure easyJet will have place for you in a nice new Boeing NG. Much more civilized than bouncing about in a Dash8, cramming yourseld into a CRJ or dragging around in a 146...
Go is worth £374m because thats what it cost in the market this morning. How much is BEA worth I wonder..?!?
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The most interesting question of all is how happy are thew Easy Captains going to feel when they hear that the Go Captains will be getting approximately £67.000 for an out lay of £485.00!
This is the value of their share options, and Barbara has announced that each 10p share will now be worth £14.00. I can see a lot of unhappy Easy people.
This is the value of their share options, and Barbara has announced that each 10p share will now be worth £14.00. I can see a lot of unhappy Easy people.
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Fantastic news, hope it puts an end to all the bickering and lets all get on with thrashing the rest of europe. To all the GO staff, just seen on EJ website plans for Take over parties, EJ parties or V.good.
Hope we get Airbus, still the 700 is nice!
Hope we get Airbus, still the 700 is nice!
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It's amazing the things that the city will put a value on. Yes Go crew are definately an asset but there are other things like taking a competitor out of the market, that alone will be worth a few hundered million, plus the goodwill of passengers & suppliers.
Now I may be synical but I wonder how many Easyjet investors were buying up 3i shares this morning.
It's amazing the things that the city will put a value on. Yes Go crew are definately an asset but there are other things like taking a competitor out of the market, that alone will be worth a few hundered million, plus the goodwill of passengers & suppliers.
Now I may be synical but I wonder how many Easyjet investors were buying up 3i shares this morning.
The deal is done and why should anyone begrudge the GO pilots there money, lets hope all the bull*hit can be put to one side and we can all work together to make something of this new venture !
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Not involved with either party but I remember when we were bought out and if all adopt Noflare's attitude they'll be fine. After the worry of the inevitable restructure of course.
Good luck to all involved.
Good luck to all involved.
Last edited by Desk Driver; 16th May 2002 at 13:11.
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Seems they won't be a need to worry about the restructure
EasyJet PLC chairman Stelios Haji-Ioannou said the £374 million acquisition of Go Fly Ltd has less to do with cost savings and all with creating a carrier with enough critical mass to compete against established full-service airlines.
Combining the two airlines is unlikely to result in any redundancies or cutting back of routes, nor are ticket fares set to go up, he added.
"Fares are likely to remain at the same level as over the past years," Haji-Ioannou said, speaking at the fringe of the press conference following the announcement of the deal.
Full Story
EasyJet PLC chairman Stelios Haji-Ioannou said the £374 million acquisition of Go Fly Ltd has less to do with cost savings and all with creating a carrier with enough critical mass to compete against established full-service airlines.
Combining the two airlines is unlikely to result in any redundancies or cutting back of routes, nor are ticket fares set to go up, he added.
"Fares are likely to remain at the same level as over the past years," Haji-Ioannou said, speaking at the fringe of the press conference following the announcement of the deal.
Full Story
Cruisin level - how so a higher cost base? Surely 1 profitable airline + 1 profitable airline = 1 bigger profitable airline? The there would be reduced advertising spend, reduced admin support, bigger discounts on aircraft and contracts etc...
Hello to all in easyJet - don't believe a word they say about the BRS base, its a fractious hell hole of a base with routes from hell run by a tyrant. Honest
WWW
Hello to all in easyJet - don't believe a word they say about the BRS base, its a fractious hell hole of a base with routes from hell run by a tyrant. Honest
WWW
