US private equity firm Apollo has submitted an all-cash offer of £5.7 billion, or £7.15 per share, to acquire EasyJet, surpassing Castlelake’s £5.5 billion bid at £6.90 per share. EasyJet’s board is minded to recommend Apollo’s higher offer to shareholders after careful consideration with its financial advisers, describing the terms as favorable and unanimous in support [1, 2, 3, 4].
Apollo’s bid values EasyJet at around US$7.7 billion. The board had initially agreed in principle to Castlelake’s fifth improved offer but later shifted to back Apollo’s stronger cash proposal [1, 2, 4]. Apollo has also proposed an option for shareholders to roll over their shares into a stub equity structure, allowing continued investment in the company post-acquisition [1, 3].
Apollo stated it supports EasyJet’s existing business strategy, including plans to upgrade its fleet, enhance ancillary services and loyalty programs, and scale holiday offerings. The firm emphasized retaining key management and employees and confirmed it does not intend to break up the airline [1, 2]. Apollo said, "We believe in easyJet’s existing strategy of evolving and strengthening the low-cost carrier model," and "placing a high value on people and retaining key staff" is paramount [1].
Castlelake, meanwhile, gained access to EasyJet's commercial information on June 25 to inform its improved bids. It also put forward former EasyJet executive Peter Bellew in its proposed management structure [2, 4].
EasyJet reported a first-half financial loss of £377 million, mainly due to soaring fuel prices and ongoing geopolitical tensions, underscoring operational challenges ahead [4].
Under UK takeover regulations, Apollo's deadline to make a firm offer or withdraw was August 7. EasyJet’s board announcement on July 10 signaled its intention to recommend the Apollo bid to shareholders [1, 2, 3, 4].
