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Today's business and finance round up 21st July 2021

✈EasyJet optimistic over summer travel

21st July 2021

Good morning Yesterday Amazon founder and world’s richest man Jeff Bezos safely returned to earth after blasting off into space on a Blue Origin flight. He was joined by his younger brother, Wally Funk an 82-year-old space pioneer and Oliver Daemen an 18-year-old Dutch student. Daeman got an invite after another passenger (who paid $28m in an auction) bailed due to a scheduling conflict.It begs the question –if you can afford a $28m ride to space, surely you can afford a PA to manage your diary?

Today's stories

  • EasyJet optimistic over summer travel

  • Morrisons’ bidding war cools

Yesterday's market moves

FTSE 100  +0.5%    6,881 FTSE 250  +0.8%   22,119

UK markets rebounded yesterday partially recovering from the freefall the day before. Investors had taken advantage of the dip in prices to help push stocks higher. But fears over the spread of Covid remain as restrictions tighten in countries across the world. 

TRAVELEasyJet optimistic over summer travel

What’s going on?Budget airline EasyJet expects to fly at 60% of 2019 capacity levels during the peak summer period of July to September. That’s despite the fact that just 44% sold of seats have been sold, compared to 69% in the same period in 2019.The company say that customers are leaving booking up to the last minute given the ongoing travel restriction uncertainties.

Why is this important?

EasyJet has reported the most optimistic trading statement since the pandemic begun almost 18 months ago.Even though it flew just 17% of its 2019 capacity between April and June this year, it expects to get to more than halfway to pre-levels in the next three months. The airline is switching its capacity from the UK to the rest of Europe this summer reflecting relative demands in the two locations. Two-thirds of its bookings had come from mainland Europe. Normally, its business is evenly split between the UK and the continent but easyJet expects that to change now travel rules for fully-vaccinated Brits have been relaxed.EasyJet called on the government to add many more European countries to its green quarantine-free travel list, reflecting lower Covid infection levels, and to drop testing requirements for those destinations.

TakeawayAlthough it was an upbeat statement from EasyJet it still made a loss of £318m in the past three months, a slight improvement on the £347m loss reported during the same period last year that covered the first lockdown.The road to recovery will be long, the airline does not expect travel to fully reach 2019 levels until 2023.

RETAILMorrisons’ bidding war cools

For the past few weeks Morrisons, Britain’s fourth largest grocer, has been at the centre of a bidding war between American private equity firms.  In June Morrisons rejected a $5.5bn offer from CD&R, then two weeks later Fortress Investments Group (which owns Majestic Wines) threw its hat in the ring with a £6.3bn bid which the supermarket’s board accepted.There had been talk that other potential buyers could emerge given how attractive Morrisons is as an investment – it has a 500 store property portfolio and 10% share of the UK grocery market. And another US private equity firm, Apollo, was thrown in the mix. However Apollo has confirmed that it won’t be putting in an offer but will instead consider join forces with Fortress Investment Group whose offer has been accepted but is subject to shareholder approval.But this might not be the end of the story. CD&R has until mid-August to come back with counter-offer. And there’s still rumours that Amazon, which has a partnership deal with Morrisons, could come in with an 11th hour offer.

Stat of the day

There's £550m unclaimed on unused Transport for London oyster cards

Other stories to keep you in the loop

  • Business urges government to get control of ‘pingdemic’ confusion

  • Online grocery sales fall for first time ever as consumers return to shops and restaurants

  • HMV plans to open 10 new stores this year as retailer celebrates 100th birthday

  • Apple delays return to office as Covid cases rise

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