AerCap (AER) has secured unconditional regulatory approval for its proposed takeover of General Electric’s (GE) aircraft leasing business for $30 billion. Reuters reports that the European Commission did not see any competition issues.
Regulatory approval in Europe comes on the heels of the U.S Department of Justice giving the deal a green light. (See General Electric stock charts on TipRanks)
The $30 billion transaction is made up of about $24 billion in cash and $1 billion paid in AerCap notes or cash. It also includes 111 million new shares expected to give General Electric a 46% stake in the AerCap-controlled company.
The takeover will result in a new financing giant and the largest buyer of airliners built by Airbus. Additionally, the takeover could transform the global air finance industry, which has seen an influx of capital from investors eyeing high returns in recent years.
Analysts expect the $30 billion acquisition to spark a wave of consolidation in the sector amid the ongoing recovery from the COVID-19 crisis.
UBS analyst Markus Mittermaier recently reiterated a Buy rating on General Electric with a $17 price target, implying 30% upside potential to current levels.
Consensus among analysts is a Moderate Buy based on 8 Buys and 2 Holds. The average General Electric price target of $15.75 implies 20.4% upside potential to current levels.
GE scores a “Perfect 10” on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.
Related News:
Why Has General Motors Been in the Spotlight Lately?
First Hawaiian Reports Strong Q2 EPS
Kimberly Clark’s Q2 Results Miss Estimates, Guidance Lowered
