Apollo Global Management has agreed in principle to acquire budget carrier easyJet in a deal valuing the airline at about £5.7 billion, according to a company statement early Friday. The proposed cash price of £7.15 per share tops a rival offer from U.S. private credit group Castlelake and has prompted easyJet’s board to signal it is inclined to recommend the transaction to shareholders.
Deal specifics and rival offer
EasyJet said the Apollo proposal delivers greater cash value to shareholders than Castlelake’s latest submission of £6.90 per share, which had been part of a previously reported plan to take the airline private for about £5.5 billion. The competing process put pressure on the sale timetable: Castlelake had until Aug. 3 to formalize its bid.
"The proposed cash offer delivers a superior outcome for easyJet shareholders by providing a higher cash value than Castlelake’s latest proposal of £6.90 per easyJet share,"
Apollo said it would take "all necessary steps" to meet any European Union local ownership requirements, a practical concern because current EU rules mandate majority European ownership of airlines. Castlelake’s approach reportedly contemplated bringing two Irish airline executives onto the board to address local ownership conditions.
Market reaction and premiums
Shares jumped on the announcement, with easyJet stock rising about 13% in early trading. Apollo’s offer represents a 22% premium to the airline’s closing price the day before the bid and an 81% premium relative to the price just before Castlelake’s offer period began.
| Item | Value |
|---|---|
| Apollo offer per share | £7.15 |
| Castlelake offer per share | £6.90 |
| Deal value (Apollo) | £5.7 billion |
| Deal value (Castlelake, reported) | £5.5 billion |
Broader market context
The takeover news arrived as Asian markets showed mixed trading: Japan’s Nikkei and Hong Kong’s Hang Seng were each up about 1%, South Korea’s Kospi gained nearly 3%, while mainland China’s SSE Composite slipped roughly 0.3%. Other headline items on the business calendar include upcoming EU consumer price index readings and scheduled earnings from Delta Air Lines.
- EasyJet board is reported to be inclined to recommend Apollo’s offer to shareholders.
- Apollo has committed to addressing EU ownership rules as needed.
- The competing bid from Castlelake had included steps to satisfy local ownership rules by adding Irish airline executives.
For shareholders, the Apollo proposal raises the prospect of a near-term cash exit at a notable premium to recent trading levels. For regulators, the transaction will likely trigger scrutiny of ownership and control given EU nationality rules for carriers. For private equity and credit investors, the quick escalation between bidders highlights continued appetite for aviation assets despite sector volatility in recent years.
Further details, including final approvals, the formal recommendation from easyJet’s board and any regulatory conditions, are expected as the parties move to firm up the transaction.
