EasyJet’s board announced it would recommend a £5.7bn acquisition proposal from Apollo to shareholders, valuing the airline at £7.15 per share. The decision represents a shift in direction for the company, as the board had previously signaled support for a £5.5bn offer from Castlelake at £6.90 per share earlier in the week.
Apollo’s increased bid has triggered a competitive bidding process for the low-cost carrier. The US private equity firm’s offer structure permits current shareholders, including founder Stelios Haji-Ioannou and his family who control over 15% of the company, to maintain their investment positions rather than being forced to exit upon delisting. Under the existing brand licence agreement with Haji-Ioannou, Apollo stated it would continue the royalty arrangement. Should the founder elect to sell his stake at the proposed valuation, he would receive approximately £855m.
Apollo indicated it would preserve easyJet’s existing operational strategy and management team, stating the company plans to continue the low-cost carrier model while upgrading its fleet, expanding ancillary services and loyalty programs, and developing the holidays business segment. The firm emphasized its commitment to retaining key personnel within the organization. Apollo has until early August to submit a formal offer and pledged to meet European Union regulatory requirements regarding foreign ownership of airlines, which mandate majority European ownership even following Brexit.
Castlelake indicated it would evaluate its position following Apollo’s bid. The firm had previously secured partnerships with two aviation industry figures—Peter Bellew, a former chief operating officer at multiple carriers, and Mark Breen, chief executive of an aerospace company—to address EU ownership requirements. EasyJet’s share price increased substantially following the announcement, reflecting investor enthusiasm for the competitive acquisition process.
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