Airlines

Capital Calls: EasyJet, Nexi

27 Sep 2022

Concise views on global finance: The budget airline scraps its offset plan and focuses efforts on cleaner technology; the 12 bln euro payment company’s valuation gap with peer Worldline looks increasingly hard to justify.

Alitalia successor approaches safe landing spot

1 Sep 2022

Investor Certares has bid 700 mln euros for a majority of ITA, the shrunken offshoot of the troubled airline. Backing from Air France and Delta should ensure better landing slots and access to lucrative U.S. routes. It may avoid more bailouts, but Rome will still have a big say.

Transportation M&A nightmare worth the trip

8 Aug 2022

Often when industries with monopolistic traits consolidate – airlines, trains - there’s a race to be an acquirer. Buyers end up paying top dollar, and regulatory concessions can be steep. Still other industries have shown the finish line is rewarding if investors stick it out.

China’s Hawaii washes away an economic sandcastle

8 Aug 2022

A Covid-19 outbreak has locked down cities in Hainan, stranding over 80,000 visitors. It sets back a decent recovery in tourism, a generator of more than 11% of pre-pandemic GDP. With other growth pillars shaky, it’s the worst time to give consumers another reason to check out.

JetBlue buckles up for long, turbulent M&A flight

28 Jul 2022

After a near-four-month tussle, the U.S. budget airline clinched a $3.8 bln deal with rival Spirit. It stacks up if hoped-for extra profit results. The price is still high: If the merger fails – as it might – JetBlue may have to pay Spirit one-fifth of its market value.

Cathay Pacific charts hopeful course for Hong Kong

18 Jul 2022

Huge capacity cuts and a bailout put a lid on debt as quarantine rules keep its home city isolated. Its shares, better performing than Singaporean and Western peers, imply the airline and the Asian hub will make a quick turnaround. But it faces a harder slog back to normal.

Capital Calls: Delta’s earnings are bad and worse

13 Jul 2022

Concise views on global finance: Shares in the company fell 7% after the company missed earnings expectations. That’s bad, but worse is that its main strength – pricing power – has limits.

Americans’ urge for the open road knows few bounds

1 Jul 2022

Travelers book flights for convenience – and in theory rising gas prices help that trend. But time is money, too, and plane delays are increasing. Assign a reasonable value for an airport setback, and it suggests holiday travelers should blare "Holiday Road."

JetBlue has its “Top Gun: Maverick” moment

28 Jun 2022

With two days before a key deal deadline, the budget airline has pulled out some creative aerobatics to win over target Spirit, and swat away a favored rival bid by Frontier. The offer of more cash up-front is daring – but takes JetBlue’s shareholders deep into the danger zone.

Airlines M&A plays regulator roulette

27 Jun 2022

Budget carrier Frontier raised its offer for peer Spirit to $2.6 bln. That’s just enough to compete with rival JetBlue’s bid. Now shareholders have to weigh merger-skeptical regulators. It’s not just a calculation of who can win, but what the buyer will give up for it to happen.

Spirit investors should pick price over certainty

15 Jun 2022

The budget airline’s shareholders have the choice of a $2.2 bln cash-and-stock offer from Frontier, or a much higher but less secure offer from JetBlue. Even adjusted for the likelihood of failure, JetBlue’s offer looks better. Frontier’s choice: pay more, or get bumped.

Aeroflot’s travails are metaphor for Russia

9 Jun 2022

Sanctions have curtailed the state-run carrier’s routes and grounded its jets. Moscow will underpin a $3 bln rights issue by raiding its rainy-day fund. As its economic isolation deepens, more oil dollars will have to be diverted to struggling domestic enterprises.

Boeing’s chief pilot has risky path out of dive

20 May 2022

A blizzard of bad news has pushed the $75 bln U.S. plane-maker’s market value below rival Airbus for the first time. Customers are fuming about delayed orders. Assuming it can actually deliver jets, the risk is CEO Dave Calhoun keeping buyers sweet with ever bigger discounts.

Spirit shareholders can push for more legroom

19 May 2022

The budget airline wants shareholders to reject a $3.3 bln hostile offer from JetBlue, and stick by a merger with rival Frontier. But Spirit investors would be losing out on a potential bidding war. Frontier can probably pay more, and sitting tight could nudge it into doing so.

Spirit shareholders are flying without a pilot

16 May 2022

JetBlue launched a $3.3 bln hostile, all-cash offer for the ultra-cheap carrier. That’s almost 60% more than Spirit’s agreed cash-and-stock deal with Frontier. A JetBlue tie-up could face more antitrust scrutiny. But without an open process, Spirit shareholders are on their own.

Capital Calls: Business travel, Adidas China woes

6 May 2022

Concise views on global finance: British Airways owner IAG faces stormy UK skies; Chinese lockdowns and boycotts are slowing down the German sneaker maker.

Capital Calls: JetBlue antitrust risk haunts Spirit

2 May 2022

Concise views on global finance: The low-cost U.S. airline rejected its midmarket rival's takeover offer. Spirit reckons that even a price 50% higher than its agreed sale to Frontier doesn't compensate for Washington's anti-merger stance.

Stranded jets are least of plane lessors’ problems

14 Apr 2022

Big fleet-owners like AerCap may have to write off $10 bln of planes trapped due to Russian sanctions. Ultimately, though, insurers should cover their losses. A bigger brake on the aircraft-leasing industry’s rapid ascent is the rising cost of debt from jittery lenders.

Antitrust worries can ground JetBlue’s Spirit bid

6 Apr 2022

The U.S. airline’s shock $3.6 bln bid for its ultra-budget rival offers few cost savings and could lead to higher fares. That increases the risk that competition regulators – or Spirit’s board – stop it getting off the ground. For skeptical shareholders, that would be a relief.

Capital Calls: Continental, Harley-Davidson

8 Feb 2022

Concise views on global finance: German car-parts maker Continental may spin off its self-driving unit, while the iconic maker of motorbikes has turned supply shortages to its own advantage.