Cantor Fitzgerald Europe: easyJet bid for Monarch assets ‘likely’

Monarch Airlines has been placed into administration, the largest ever UK carrier to cease trading. Rob Byde, director of industrials & transport research at Cantor Fitzgerald Europe believes this is another step in the consolidation of the European short-haul market, following recent troubles at Alitalia and Air Berlin.
“EZJ is reported by the media to be considering a bid for assets and we think this is likely. Monarch appears to be a good potential fit and we think that EZJ needs a new source of growth following aggressive expansion at London Gatwick airport in recent years. Other carriers will also look at aircraft and airport landing slot assets,” said Byde.
Byde continues that any bids will be closely scrutinized by the UK competition and aviation authorities with concerns about market concentration. EZJ is due to update the capital markets this Friday on full year trading and is generally our preferred European carrier, trading on a calendar 2018e PE of 12x vs. an historic average metric of 13x.