Buyout aviators flag under-the-radar airline value

Air Canada announced on August 11 a C$2.5 billion minority equity investment in its loyalty programme Aeroplan. The deal, led by Blackstone and La Caisse, values Aeroplan at C$10 billion.

Apollo Global Management and easyJet announced on August 6 they had reached an agreement on the terms and conditions of a recommended cash acquisition of the UK-listed airline. The deal values easyJet at approximately £5.7 billion, according to the statement.

U.S. alternative investment firm Castlelake had also expressed interest in acquiring easyJet, before walking away.

The question is how to unlock this value. Jet2 founder and 16% shareholder Philip Meeson may not want to sell. But that still leaves the group with plenty of firepower to buy back stock, with an up to £250 million programme launched in July. A more complex route was outlined by Air Canada, which on Tuesday announced a deal to sell a minority stake in its loyalty business to Blackstone and others, valuing the unit at C$10 billion, more than its entire market capitalisation. Cheap valuations and savvy dealmaking means airline investing needn’t be a no-frills journey.