Apollo Global Management has reportedly made a higher bid of £5.7 billion to acquire easyJet, potentially disrupting the prior agreement in principle between easyJet and US investment firm Castlelake. Castlelake's offer, agreed upon for £6.90 per share on July 4th, valued the airline at approximately £5.2 billion, or £5.5 billion on a fully diluted basis. EasyJet's board had previously indicated it would recommend Castlelake's offer to shareholders, following four rejected lower bids that Castlelake made, ranging from £5.60 to £6.50 per share. Castlelake had until August 3rd to formalize its proposal or withdraw.
This new development introduces a competitive element to the easyJet takeover. Castlelake, which already holds about a 2.14% stake in easyJet, had overcome initial resistance from the budget airline, which had initially accused Castlelake of attempting to buy it "on the cheap." Castlelake's initial proposals included a plan to partner with two EU nationals, Peter Bellew and Mark Breen, to satisfy EU regulations requiring airlines to be majority-owned and controlled by EU citizens, a hurdle analysts also highlight for any new bidder.
The potential acquisition of easyJet has been a significant event in the European aviation sector, particularly given the airline's valuable landing slots at major airports like London Gatwick, Paris, and Geneva. EasyJet, founded in 1995, had struggled to fully recover from the COVID-19 pandemic, although its package holidays business and efficient Airbus fleet were considered strong points. The airline operates 355 aircraft across over 1,200 routes in 38 European countries.
