- EasyJet's board has agreed in principle to a £5.5bn takeover offer from the US investment firm Castlelake, marking a significant shift after weeks of negotiations and multiple rejected bids.
- The winning bid from Castlelake values EasyJet at 690p a share, which is a substantial increase from earlier offers that were rejected.
- Castlelake had previously expressed frustration over EasyJet's directors' unwillingness to engage with its lower bids, but the tone shifted with the recent agreement.
- The formal offer deadline for Castlelake to finalize the deal is set for 3 August.
- The agreement follows a series of fraught negotiations and represents the fifth offer made by Castlelake to acquire EasyJet.
- EasyJet's shares had struggled recently, trading below 340p, which made the airline a more attractive target for acquisition.
- The first bid from Castlelake was worth £5.60 a share, indicating the significant increase in the final offer.
EasyJet has agreed in principle to a £5.5 billion takeover by US investment firm Castlelake, marking a significant shift after weeks of negotiations and four previous rejected offers. The deal, which values EasyJet at 690p per share, will see Castlelake acquire a 49% stake in the airline, with the remaining 51% held by Brookfield Asset Management and former executives.13
The agreement comes as EasyJet has faced challenges, including two profit warnings earlier this year and a decline in bookings attributed to the US-Israeli war on Iran. EasyJet's shares had fallen below 340p, making it a more attractive target for acquisition. The 690p offer represents a significant premium for shareholders who bought in at lower prices.
Kenton Jarvis, EasyJet's CEO, noted the airline's struggles, stating that the company is committed to modernizing its fleet and cutting fuel costs. Castlelake has expressed its intention to support EasyJet's growth and transformation into a more resilient airline, emphasizing its respect for the company and its employees. The deal is expected to be finalized by 3 August, pending regulatory approvals and compliance with EU ownership rules.
The investment bank Evercore advised EasyJet during the negotiations, while Goldman Sachs represented Castlelake. This acquisition could be worth nearly £800 million for EasyJet's founder, Stelios Haji-Ioannou, who retains a significant stake in the company.
“The 690p-per-share offer values easyJet at £5.2bn, with Castlelake taking a 49% stake while Brookfield Asset Management and two Irish executives hold the remaining 51% to comply with EU ownership rules. Founder Stelios Haji-Ioannou, who owns over 15% of the company, could net nearly £800m from the deal, which requires a firm offer by 3 August.”
