easyJet agrees in principle to $6.9bn Castlelake takeover

EasyJet's board agreed in principle on Sunday 5 July to a fifth takeover proposal from US investment firm Castlelake, paving the way for a deal that would take Europe's second-largest low-cost carrier private and potentially end its 25-year listing on the London Stock Exchange.

Castlelake submitted the offer of $9.20 (£6.90) per share in cash on 4 July, valuing easyJet at approximately $6.9bn (£5.2bn), with the board requesting a new deadline of 3 August for a formal offer. EasyJet shares rose as much as 11 per cent on Monday 6 July but continued to trade below the $9.20 (£6.90) offer price, signalling that investors remain uncertain about whether the deal will close at those terms given the regulatory hurdles ahead.

The accepted offer is 73 per cent above the $5.09 (£4.03) closing share price on 29 May, the day before Castlelake's interest became publicly known, and follows four rejected bids at 560p, 600p, 625p and 650p per share respectively. It remains short of the $8.85 (£7) per share that some shareholders had cited as their threshold for an acceptable offer, according to City AM.

EasyJet said in its statement that Castlelake had emphasised its "tremendous respect for easyJet and its people, along with its intention to support its future growth and transformation to a stronger, more resilient European airline." Castlelake confirmed its support for the airline's ongoing Airbus A320neo and A321neo fleet modernisation programme, which it described as central to easyJet's long-term competitiveness.

The ownership structure of the acquiring vehicle remains unchanged from prior disclosures. Castlelake and co-investors including Brookfield Asset Management will hold 49 per cent, with 51 per cent held by EU nationals, including former easyJet chief operating officer Peter Bellew and Mark Breen, founder of Irish consultancy Oneiros Aerospace, to satisfy European Union foreign-ownership rules requiring a majority of any EU-licensed carrier to be owned by EU or European Economic Area (EEA) nationals.

Bernstein analyst Alex Irving told FlightGlobal the firm views Castlelake as a "major player in the aircraft leasing business, but not a traditional private equity firm," and that this indicates a likely "future break-up of the company and separation of its valuable assets." Bernstein's most likely scenario sees easyJet's in-service fleet, near-term deliveries, slot portfolio and easyJet Holidays sold to European network carriers, with portions of the orderbook finding their way to airlines outside Europe. The fleet of more than 200 owned aircraft and an order book of approximately 180 A320neo and A321neo aircraft powered by CFM International LEAP-1A engines is described by Bernstein as the key to Castlelake's interest.

EasyJet operates 356 aircraft and remains Europe's second-largest airline by seat capacity for summer 2026; any formal offer requires shareholder approval, and there is no guarantee shareholders would accept the terms. Castlelake has until 3 August to submit its formal offer; if it fails to do so, it is prohibited from making another approach for 12 months under Takeover Panel rules.