British budget airline easyJet has engaged in discussions with Sir Richard Branson’s Virgin Atlantic to explore a deeper partnership involving codeshare agreements and loyalty programme cooperation, according to sources familiar with the talks. The conversations come shortly after easyJet agreed to be acquired by US private equity firm Apollo Global Management in a deal valued at £5.7 billion.

Codesharing, an arrangement where one airline operates a flight while partner airlines market seats on that service, enables carriers to expand their network reach without adding new routes. Interline agreements, another form of cooperation under consideration, allow passengers to book connecting flights on different carriers with streamlined baggage handling and ticketing. These types of partnerships currently account for roughly a quarter of global connecting air traffic.

The potential collaboration between easyJet and Virgin Atlantic could enhance fare and route options for passengers, particularly given Virgin Atlantic’s focus on long-haul services and easyJet’s strength in short-haul flights. Since 2017, a “Worldwide by easyJet” programme has allowed Virgin Atlantic passengers connecting at London Gatwick to access easyJet flights, alongside other airline partners. However, Virgin Atlantic has since shifted much of its operations to Heathrow, complicating the existing arrangement.

Apollo’s acquisition of easyJet, which is expected to be put to a shareholder vote following board approval, prioritizes such partnerships as part of a broader strategy to boost the airline’s growth and profitability. The purchase is structured with between £2.7 billion and £3 billion in debt financing and includes up to £1 billion in preference shares carrying a 14 percent interest rate, which would significantly increase easyJet’s interest obligations.

In addition to exploring codeshare and interline opportunities, Apollo’s “value-creation programme” outlines initiatives to enhance winter profitability and develop a “premiumisation” strategy, potentially introducing business-class fares on select routes. While one source minimized the likelihood of a combined loyalty programme at this stage, discussions have reportedly focused on expanding codeshare and ticketing cooperation.

Neither easyJet, Virgin Atlantic, nor Apollo commented on the details of the discussions. Apollo’s existing financial ties to Virgin Atlantic include a $745 million loan secured against take-off and landing slots at Heathrow, lending further context to the potential partnership.