EasyJet announced it intends to accept a takeover offer from Castlelake, a US-based investment firm, valuing the transaction at £5.5bn. The agreement in principle was reached on Sunday evening following an extended negotiation period during which Castlelake had submitted multiple proposals. The airline’s board indicated its willingness to accept £6.90 per share, a significant increase from earlier bids that valued shares at £6.50 and £5.60.
The deal would result in substantial gains for easyJet’s founder Stelios Haji-Ioannou, who maintains ownership of more than 15% of the company alongside family members and stands to gain approximately £800m if the transaction completes. Prior to the agreement, easyJet’s shares had closed at £5.58, giving the company a market capitalization of £4.2bn. The proposed price represents a notable premium, particularly when compared to market valuations from recent years, though it falls short of the £7 threshold that some shareholders had urged the company’s chair, Stephen Hester, to pursue.
Analysts attributed easyJet’s vulnerability to takeover interest to operational challenges encountered earlier in the year, including two profit warnings issued in spring and reporting of weakened bookings tied to geopolitical tensions. The airline also contends with intense competition in the European low-cost sector from carriers including Ryanair, Wizz Air, and Jet2. Castlelake, headquartered in Minneapolis and founded by banker Rory O’Neill, specializes in asset-based lending and aircraft leasing operations.
Castlelake has signaled intentions to support easyJet’s growth trajectory and initiatives to modernize its aircraft fleet, which operates from 164 airports across 38 countries. The firm indicated it would establish a European holding company with EU national leadership to satisfy regulatory requirements governing foreign ownership of airlines. The transaction remains subject to regulatory approval, with Castlelake required to submit a formal offer by August 3 or withdraw its bid. Investment banks Evercore and Goldman Sachs provided advisory services to easyJet and Castlelake respectively throughout the negotiation process.
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