The private sector, Castlake, has raised the purchase price for the United Kingdom ' s Affordable and Affordable Airlines, leading to an increase of about 10 per cent in the company ' s share price. The transaction is still in the process of a principled agreement and Castlake is required to submit a formal offer by 3 August.

The offer increased to Pound5.5 billion.

After a number of previous attempts at acquisition, Castlake once again proposed a new scheme. An offer of Pound 49.33 billion was rejected last month by ETA, which raised the cash offer to Pound5.5 billion.

According to the latest scheme, shareholders receive approximately $6.90 per share. In a joint statement, the parties stated that a principled agreement had been reached on the deal.

  • The latest offer is Pound5.5 billion.
  • Last rejected offer was Pound 49.33 billion.
  • Date of formal offer is 3 August

High oil prices compress airline profits

This acquisition proposal comes at a time when the global aviation industry is facing cost pressures. The conflict in the Middle East continues to push up the price of oil for shipping and there has been a marked increase in airline fuel expenditures.

The International Air Transport Association had warned that, if high oil prices continued, the global airline industry could be cut by half this year. The Agency expects that fuel prices will remain at about 70 per cent higher than during the same period of the previous year.

Six months of loss is still increasing pressure.

The latest semi-annual report published by Le Aviación shows a pre-tax loss of Pound552 million for the six-month period ending 31 March. However, during the same period, there was an increase of 12 per cent to Pound4 billion.

At the same time, management suggests that passengers may face higher fares in the future. With regard to post-acquisition planning, Castlake expressed support for the long-term development strategy of FAC and hoped to promote companies as more resilient European airlines.

Castleke also expressed support for the fleet modernization plan, which would increase fuel efficiency and operational efficiency and help companies to reduce costs in the long term.