=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SF Gate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2002/05/08/f= inancial0837EDT0036.DTL ---------------------------------------------------------------------- Wednesday, May 8, 2002 (AP) Easyjet takes out option to buy Deutsche BA (05-08) 05:37 PDT LONDON (AP) -- Low-cost airline easyJet Wednesday said it had acquired an option to buy Deutsche BA, the German subsidiary of British Airways. EasyJet and British Airways signed an agreement under which the budget airline was granted the option to acquire Deutsche BA at any time up to July 3, 2003. EasyJet will contribute 5 million euros ($4.5 million) toward the cost of turning Deutsche BA into a low-cost airline and pay an additional 600,000 euros ($540,000) per month until the exercise of the option. If it exercises the option, easyJet will then pay another 30 million eur= os ($27 million) to 39 million euros ($35.1 million). "This arrangement gives us the opportunity to establish easyJet as the largest low-cost airline in Germany in one step and enhance our growth opportunities," said easyJet chief executive Ray Webster. Deutsche BA has a fleet of 16 Boeing 737-300s and carried more than three million passengers in the year to March 31, 2001. It is German flag-carrier Lufthansa's biggest rival on domestic routes. "We welcome the whole thing, because we would fit very well into the concept of EasyJet," Deutsche BA spokeswoman Antje Urban said from the company's headquarters in Munich. Deutsche BA noted that it turned to a new business model as a "low-price quality airline" in April. EasyJet will send three of managers to assist the restructuring of the German airline. EasyJet, based at Luton Airport, north of London, announced the buyout option as it posted a surge in sales and profit for the six months ended March 31. EasyJet earned 1 million pounds ($1.46 million) for the six months compared with a loss of 10.3 million pounds in the corresponding period last year. Sales rose 36 percent to 194 million pounds ($283 million). EasyJet said strong passenger demand, the earlier than usual timing of t= he Easter break and good weather had all contributed to the positive result. The airline's passenger numbers were up 36 percent to 4.3 million and it introduced five new routes from London's Gatwick airport, where easyJet is now the second largest scheduled carrier behind the British Airways group. It began the new routes to Barcelona, Edinburgh, Malaga, Mallorca Palma and Zurich in February 2002. It begins flying another route to Athens from Gatwick on July 1, 2002. By the summer, it will be serving 19 airports and operating 45 routes. EasyJet last week said it was in "exclusive negotiations" about a possib= le takeover of its no-frills rival Go. Go, developed as British Airways' bargain airline, was bought out last June by management, backed by venture capitalists 3i. EasyJet said those acquisition talks were part of continuing plans to expand in the European short-haul market. =20 ---------------------------------------------------------------------- Copyright 2002 AP