In a bid to expand its presence in Malta, Ryanair Holdings RYAAY has inked a deal to purchase Malta Air — a start-up carrier. However, the value of the deal was not disclosed.
The acquisition, expected to be completed by June 30, 2019, will strengthen this European low-cost carrier’s foothold in Malta. Also, it will allow the company to operate flights from Malta to non-EU markets (North Africa). Currently, Ryanair is responsible for transporting 3 million passengers to and from Malta.
Following the buyout, the carrier aims to switch its Malta-based fleet of six B737 jets to the country’s register. Additionally, Ryanair intends to increase the above fleet size to ten within three years. This, in turn, is anticipated to create in excess of 350 jobs. For summer 2020, Ryanair, which will get a Maltese air operator’s certificate (AOC), plans to market its Malta-based fleet in Malta Air colors.
Furthermore, this Irish company aims to move its planes from France, Italy and Germany onto the Maltese AOC for allowing the concerned crew members to pay income taxes locally. Under the current arrangement, they are required to pay under the carrier’s Irish AOC.
The acquisition apart, Ryanair, carrying a Zacks Rank #5 (Strong Sell), was in the news recently owing to its May traffic report. In the month, traffic (including 0.6 million from its LaudaMotion unit) rose 13% year over year to 14.1 million, courtesy of upbeat demand for air travel. However, Ryanair’s passenger growth, excluding traffic from LaudaMotion unit, was only 8% in May. Consolidated load factor (% of seats filled by passengers) in the month was 96%.
Stocks to Consider
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