EU to Review Airline Ownership Rules, May Hit EasyJet Bid
The review could clarify control rules and affect a €5.7 billion Apollo bid that EasyJet backed earlier this month, the official said.
- On Wednesday, an EU official announced the European Union is preparing a review of airline ownership rules to "protect strategic autonomy" and prevent foreign investors from gaining effective control of regional carriers, potentially complicating U.S. bids for EasyJet.
- EasyJet recently backed a £5.7 billion offer from Apollo Global Management, trumping a £5.5 billion bid by Castlelake, though the airline has yet to explain how it will meet EU rules requiring 51% local ownership.
- Investor concerns that the review might delay or block potential deals caused EasyJet shares to fall 15 per cent, while an unnamed official noted the industry is on the "wrong foot" regarding strict rule enforcement.
- Current regulations mandate that EU air carriers must be majority-owned and effectively controlled by EU nationals to retain operating licenses, though industry insiders suggest U.S. suitors could attempt to use EU proxies to satisfy these requirements.
- Aviation analyst James Halstead noted that new regulations could take years to approve, potentially allowing deals to close before changes take effect, while the review could set a precedent for future private equity buyouts in the closely regulated industry.
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The European Union is preparing a review of the rules on the ownership of airlines to prevent foreign investors from obtaining effective control of the companies in the sector, according to an employee of the block. The measure may complicate the proposals for US funds by the British low-cost airline EasyJet. The new review aims to protect strategic autonomy and ensure that the control of regional carriers remains within the European block. The …
EU Airline Ownership Rules Under Scrutiny Amid EasyJet Bid Battle
The European Union is reviewing airline ownership rules to prevent foreign investors from wielding control over regional carriers. This move comes amid U.S. firms' bids for easyJet, highlighting EU's 51% local ownership rule. The review could impact future private equity buyouts within Europe's regulated airline sector.
Easyjet shares crash on fears of EU probe
Shares in Easyjet plummeted on Wednesday after reports the European Union was preparing a probe into the ownership of airlines, potentially complicating the carrier’s mooted takeover by Apollo. The London-listed budget airline said this month it was likely to accept an all-cash offer from the US investment behemoth, trumping an earlier bid from another US buyout firm, Castelake. But the takeover has been cast into doubt by an EU review into airl…
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