EasyJet moves closer to buying Deutsche BA

EasyJet has come a step closer to buying British Airways' German subsidiary.

It has acquired an option to buy Deutsche BA and turn it into a no-frills airline.

EasyJet may exercise the option at any time up to April 30, 2003.

This period can be extended by easyJet to August 3 next year.

The company says it has received clearance for the deal from the German competition authority.

DBA's fleet of 16 Boeing 737-300s carried more than three million passengers in the year to the end of March.

EasyJet says it will second three managers and contribute €5m for capital expenditure to help change DBA into a low-cost airline.

It has also agreed to pay an extra €600,000 per month until the option is exercised.

It will then pay a further amount of between €30m and €39m to BA.