The head of budget airline easyJet (EZJ.L) has told the boss of Ryanair (RYA.I) to focus on running his own airline after he questioned the British carrier’s independence.
Ryanair group chief executive Michael O’Leary was quoted as telling the Financial Times last week that rivals easyJet and Wizz Air (WIZZ.L) would need to merge or be taken over as the industry consolidates in the wake of the COVID-19 pandemic.
“(It is) complete nonsense,” easyJet CEO Johan Lundgren said in an interview. “I would urge anyone who runs an airline to focus on their own business rather than speculate about others, (where) they have no idea about what’s going on.”
Lundgren said consolidation was already taking place in Europe as weaker airlines cancel capacity, and that easyJet was not opposed in principle to consolidation carried out in the form of external transactions.
“We are not against any M&A type of activity but it needs to be able to deliver value for shareholders and to deliver a reason to believe in a successful outcome,” he said.
Asked whether easyJet saw itself as a buyer in any future shake-out of the European airline industry, Lundgren said: “We would be looking at companies, as I am sure companies would be looking at us. There is no drama around that at all.”
Tensions had flared days after easyJet said it had rejected a takeover approach from Wizz Air that would have created a low-cost airline to rival Ryanair, opting instead to raise $1.7 billion from shareholders.
Lundgren said the rights issue was attracting broad investor support, but acknowledged some discussions about the timing.
“As with anything, we are having discussions about the size and the timing, but also the need we have to make sure we are right-funded to make sure we can invest in growth when those opportunities come,” he said.
“Most people completely understand the reason for that and(that) it is the right thing to do and the right time to do this.”