easyJet has agreed in principle to a £5.7 billion ($7.7 billion) takeover offer from US private equity firm Apollo, after it submitted a £7.15-per-share proposal that surpassed rival Castlelake’s £6.90-per-share bid.
The higher offer has prompted easyJet’s board to withdraw its support for Castlelake’s proposal, setting the stage for a competitive bidding process for the UK low-cost carrier. Investors welcomed the development, with easyJet’s share price rising sharply, although it remained below both offer prices.
Analysts say easyJet’s attractive airport slot portfolio, expanding package holiday business and modern Airbus fleet make it a highly desirable acquisition target. Apollo, which has previously invested in several aviation businesses, highlighted the airline’s long-term growth potential, while Castlelake brings extensive experience in aircraft leasing.
Any takeover will need to comply with UK and European ownership rules requiring airlines to remain majority owned and controlled by European nationals. Castlelake has already outlined such a structure, while Apollo said it intends to secure an appropriate European partner.
Under UK takeover regulations, Apollo has until 7 August to submit a formal offer, while Castlelake has until 3 August to decide its next move.