This article from NYTimes.com has been sent to you by psa188@juno.com. /-------------------- advertisement -----------------------\ Enjoy new investment freedom! Get the tools you need to successfully manage your portfolio from Harrisdirect. Start with award-winning research. Then add access to round-the-clock customer service from Series-7 trained representatives. Open an account today and receive a $100 credit! http://www.nytimes.com/ads/Harrisdirect.html \----------------------------------------------------------/ EasyJet Says It Is Considering Acquisition of a Rival, Go Fly May 4, 2002 By SUZANNE KAPNER LONDON, May 3 - EasyJet said today that it was in advanced negotiations to buy Go Fly, a rival low-cost airline, from the venture capital firm that owns it, the 3i Group. The deal would give EasyJet the largest fleet of any low-cost carrier in Europe, surpassing the current leader, Ryanair. Buzz and Virgin Express would be distant third and fourth players, analysts said. The talks surprised some analysts, who said they had not expected consolidation in what is still a young and fast-growing part of the transportation industry. With 3i determined to cash out of its investment, EasyJet is taking advantage of an unusual opportunity to buy a rival, they said. 3i, which bought Go Fly from British Airways in June, had been planning to exit the investment by taking the airline public. But with the stock markets still uncertain, selling outright to a strategic buyer seemed a surer route, analysts said. "By buying Go, EasyJet would clarify the market as having two major players only," said Christopher Avery of J. P. Morgan Chase in London. He said he did not expect a wave of consolidation: "Europe is big enough for all of the budget airlines to grow over the next 10 years." EasyJet said it made its announcement today because it had "become aware of a leak" in the negotiations. Its stock rose 4.7 percent in London to close at £4.72 ($6.91) a share. Mr. Avery said he would expect EasyJet to pay roughly £400 million ($587 million) for Go Fly - almost four times what 3i paid British Airways for the carrier last spring. The fortunes of budget airlines have improved markedly since then, compared with traditional airlines. Even after Sept. 11, when the major airlines were trimming route maps and cutting costs, the budget carriers reported steady increases in traffic. Both EasyJet and Ryanair have ordered new planes recently to keep up with demand. Analysts said that combining Go Fly and EasyJet made strategic sense. EasyJet would expand its presence in France and Italy, where it would gain airport slots in Milan, Naples, Rome and Venice, and benefit from adding Go Fly's established hub at Stansted Airport to its own operations at Gatwick and Luton. http://www.nytimes.com/2002/05/04/business/04AIR.html?ex=1021524426&ei=1&en=7b872d316df0a024 HOW TO ADVERTISE --------------------------------- For information on advertising in e-mail newsletters or other creative advertising opportunities with The New York Times on the Web, please contact onlinesales@nytimes.com or visit our online media kit at http://www.nytimes.com/adinfo For general information about NYTimes.com, write to help@nytimes.com. Copyright 2002 The New York Times Company