Shares in easyJet Rise on Reports of IAG Takeover Rumors

  • Stock Market News
Shares in easyJet Rise on Reports of IAG Takeover Rumors
Credit: © Reuters.

By Scott Kanowsky -- Shares in EasyJet PLC (LON: EZJ ) jumped on Monday after the Times in the U.K. reported on "speculation" that the budget carrier will be bought by British Airways owner International Consolidated Airlines Group S.A. (LON: ICAG ).

According to the newspaper, IAG plans to funnel a recent return to profitability into a series of takeovers aimed at consolidating the European airline industry.

One of these targets includes easyJet, which has seen its share price fall by over 47% in the last one-year period as investors warily eye a potential slowdown in winter passenger traffic and the impact of soaring input costs for airlines across the industry.

The U.K.-based group has flagged that uncertainty clouds its outlook heading into the end of 2022, but added that demand remains "robust" for now.

IAG, the Anglo-Spanish company behind other brands like Iberia and Aer Lingus, has also said bookings have shown "no indication of weakness" and are at expected levels for this time of the year.

Rumors are circulating that the group may harness this position to initiate a separate bid for Portuguese flag carrier TAP, the Times reported.

IAG chief executive Luis Gallego has not directly commented on direct merger plans, saying only that it will only pursue consolidation that "makes sense."

However, he added that the company "wants to consolidate" the European airline sector.

Madrid-listed shares in IAG (BME: ICAG ) rallied by more than 4%.


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