easyJet opens talks with Castlelake after rejecting £4.9bn takeover offer; hopes for a higher bid rise.

easyJet has rejected a £4.9 billion takeover bid from Castlelake, stating the offer of 650p per share significantly undervalues the airline. The board has opened discussions with Castlelake, hoping that limited access to commercial data will lead to a more competitive proposal.¹²⁵

The British budget carrier unanimously dismissed the latest offer, which was a 4% increase from the previous bid of 625p, and a 21% premium to the closing share price on June 24. The board expressed concerns about Castlelake's ownership structure and its ability to deliver on any offer, emphasizing the need for satisfactory assurances.⁶⁷

Castlelake, which manages assets worth $36 billion (£27.3 billion), has until 5pm on July 5 to improve its offer or withdraw. The firm has partnered with Brookfield Asset Management and two Irish aviation executives to strengthen its bid. EasyJet's decision to grant limited access to its books aims to encourage a more attractive proposal that reflects the airline's true value and prospects.⁸⁹¹⁰¹¹

Shares of easyJet surged by as much as 8% to around £5.80 following the news. Samuel Ziff, a portfolio manager at Oldfield Partners, noted that any new bid would need to be significantly higher than the rejected proposal.¹²

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EasyJet knocks back Castlelake bid but deal hopes rise