Private equity is circling budget airlines after Apollo's EasyJet deal — and this carrier could be next
Private equity investors could target more undervalued airlines following Apollo's swoop for EasyJet.
The recent interest shown by Apollo in EasyJet has sparked speculation that other budget airlines may become targets for private equity investors. This development is significant as it highlights the undervaluation of airlines in the current market, making them attractive to investors looking for opportunities. The airline industry has faced significant challenges in recent years, including rising fuel costs, increased competition, and changing consumer behavior.
The EasyJet deal demonstrates that private equity firms are willing to invest in airlines with strong brands and operations. Wizz Air, another budget airline with a significant presence in Europe, could be a potential target. Its stock has underperformed in recent years, which might make it an attractive candidate for private equity investors. Wizz Air's focus on Central and Eastern Europe also provides a unique opportunity for growth, which could appeal to investors looking for a strategic play.
Looking ahead, investors should watch for any potential bids or expressions of interest in other budget airlines. The likes of Ryanair and Norwegian Air could also be targets, although their larger size and market presence may make them less attractive to private equity investors. As the industry continues to evolve, it will be essential to monitor the valuations of these airlines and assess their potential for growth and profitability.
Originally reported by cnbc.com. BrokerNews adds analysis for finance & markets readers.