A dramatic takeover battle has erupted around EasyJet after the British low-cost airline threw its support behind a richer bid from American investment giant Apollo.
The move comes just days after the company had signaled its intention to back a competing proposal from Castlelake, highlighting how quickly the contest for one of the UK’s best-known airlines has intensified.
The latest offer, valued at approximately £5.7 billion, would see EasyJet leave the London Stock Exchange if the acquisition is completed.
Airline Says Apollo’s Proposal Delivers Greater Value
EasyJet’s board said Apollo’s cash offer provides shareholders with a stronger financial return than the rival bid submitted earlier this week.
Apollo is offering £7.15 per share, comfortably above Castlelake’s most recent proposal of £6.90 per share.
According to the airline, the improved price represents the most attractive outcome currently available for investors.
The announcement immediately boosted market confidence, sending EasyJet shares up more than 13 percent in early trading.
The stock has now climbed nearly 30 percent since the start of the year as takeover speculation has gathered momentum.
A Rapid Turnaround After Castlelake’s Initial Breakthrough
Only days earlier, EasyJet had reached an agreement in principle to support Castlelake’s £5.5 billion takeover proposal.
However, Apollo’s higher offer quickly changed the picture, prompting the airline to switch its recommendation in favor of the new bidder.
The proposal also represents a significant premium over EasyJet’s share price before takeover interest became public, valuing the airline at around 81 percent above its previous closing price.
Apollo Continues Expanding Its Aviation Investments
If the acquisition succeeds, EasyJet would become another major addition to Apollo’s growing aviation portfolio.
The investment firm already has interests in several airline-related businesses, including a stake in cargo carrier Atlas Air.
It has also provided substantial financing to Virgin Atlantic, including hundreds of millions of dollars in lending secured against Heathrow Airport take-off and landing slots.
The purchase would further strengthen Apollo’s presence within the global airline industry.
Key Deadlines Now Set for Both Bidders
Apollo has until August 7 to submit a formal takeover offer or withdraw from the process altogether.
Meanwhile, Castlelake remains in the running but faces an earlier deadline of August 3 if it wishes to return with another proposal.
The coming weeks are expected to determine whether the bidding contest continues or whether Apollo secures control of the airline.
EasyJet Previously Rejected Multiple Lower Offers
Before the latest developments, EasyJet had repeatedly dismissed several approaches from Castlelake.
Company executives argued that the earlier proposals significantly undervalued the business, describing them as opportunistic attempts to acquire the airline at an unfairly low price.
The stronger offers now on the table reflect a much higher valuation than those initially presented.
Another Potential Departure From London’s Stock Market
A successful takeover would mark another setback for the London Stock Exchange, which has seen several listed companies attract overseas buyers in recent months.
A number of British businesses have become acquisition targets as international investors seek opportunities in the UK market.
EasyJet’s potential exit would add to growing concerns about the shrinking number of major companies listed in London.
The trend has fueled debate over whether British-listed firms are becoming increasingly vulnerable to foreign takeovers.
Pandemic Recovery Left Airline Open to Interest
EasyJet has long been viewed as a possible acquisition target following the challenges created by the COVID-19 pandemic.
Although travel demand has steadily recovered, the airline’s share price has taken longer to rebound than some of its European competitors, making it an attractive prospect for private investors looking to capitalize on future growth.
The renewed bidding war reflects growing confidence that the airline’s long-term prospects remain strong.
Founder Could Hold the Deciding Vote
Any takeover is expected to require support from EasyJet founder Sir Stelios Haji-Ioannou and his family, who continue to own approximately 15.3 percent of the airline.
While the family has not publicly endorsed either proposal, reports have suggested they could be willing to sell if the offer is sufficiently attractive.
Sources previously indicated that only an exceptionally high valuation would persuade the founding shareholders to approve a sale, making their decision likely to play a crucial role in determining EasyJet’s future ownership.
