EasyJet has agreed in principle to a sweetened takeover bid from U.S. investment firm Castlelake, valuing the British budget airline at up to £5.5 billion ($7.34 billion). This offer, at £6.90 per share, represents a strong 73% premium to EasyJet's closing price on May 29, when Castlelake first disclosed its interest to British regulators. The deal would take the 31-year-old airline private, occurring amidst global operating challenges for airlines, such as higher fuel prices and profit pressures due to the Iran conflict.
EasyJet had previously turned down a £4.93 billion proposal from Castlelake in June but granted them limited access to commercial data, indicating a willingness to continue discussions. The airline's valuable landing slots at major airports like London Gatwick, Paris, and Geneva have long made it an attractive takeover target. Castlelake, a significant lender to airlines that leases aircraft to approximately 200 carriers, declined to comment beyond its joint announcement with EasyJet due to regulatory restrictions.
The proposed deal faces European Union regulations that require airlines operating in the bloc to be majority-owned and controlled by EU nationals. Castlelake has previously stated it would address this by owning 49% of the bidding vehicle, with the remaining stake held by two EU nationals: former Malaysia Airlines CEO Peter Bellew (who was EasyJet's COO from 2019 to 2022) and senior industry executive Mark Breen. EasyJet's board has indicated that the latest bid is at "a value that the Board would be minded to recommend to easyJet shareholders," though Castlelake still needs to submit a firm intention to make an offer by August 3.
British Cypriot entrepreneur Stelios Haji-Ioannou, EasyJet's founder, remains the largest investor with about a 15% stake alongside his family. He has a history of disagreements with management over growth strategies. The British market is seeing a trend of record mergers and acquisitions in 2026, as weaker valuations of London-listed companies attract buyers. EasyJet had initially characterized Castlelake's approach as "highly opportunistic," noting that its shares were depressed by the Iran war turmoil and the impact of the US-Israel war on the travel sector. Castlelake had previously made other offers, including £6.50, £5.60, £6, and £6.25 per share, which EasyJet had rejected, accusing Castlelake of trying to buy the airline "on the cheap." EasyJet's shares closed at £5.58 on Friday, having fallen by over 30% in the past year before news of the first bid emerged.
