EasyJet has formally agreed to a £5.7bn takeover by US private equity firm Apollo Global Management, following the withdrawal of rival bidder Castlelake. The deal values the budget airline at £7.15 a share, with completion expected by March 2027 as foreign ownership rules draw scrutiny.
The battle for control of the budget carrier concluded as EasyJet formally accepted a £5.7bn takeover from Apollo Global Management. The transaction brings an end to a contest that intensified after a rival US investment firm, Castlelake, stepped back from the table rather than enter an escalating bidding war.
Castlelake confirmed it would no longer pursue the acquisition, leaving Apollo as the sole remaining bidder and clearing the path for the airline board’s recommendation.
Financial Terms and Shareholder Rebound
Under the finalized terms, shareholders will receive £7.15 per share, matching the proposal Apollo tabled during the previous month after EasyJet’s board initially favored Castlelake’s £5.5bn overture. The shift in direction rewarded investors who watched share valuations climb significantly across the bidding period.
Market reaction to the turbulence showed sharp swings. EasyJet’s share price dropped 10% immediately following news of Castlelake’s exit, but quickly rebounded to trade 3% higher than the session’s opening mark once the Apollo agreement became official.
“While we remain confident in the strength of our business and the opportunities ahead, we believe this offer appropriately recognises the quality of the business we have built and delivers immediate, certain and attractive value for shareholders.”
Stephen Hester, EasyJet Chair
The airline’s leadership framed the buyout as recognition of fundamental operational value. Behind the scenes, the company had weathered a difficult quarter marked by sliding customer demand and surging fuel costs driven by geopolitical conflict in the Middle East, which contributed to a fall in profits as the Iran war fuelled a surge in fuel prices, and customer demand fell.
Ownership Structure and Regulatory Hurdles Ahead
To navigate strict European Union aviation regulations regarding foreign ownership, the acquisition incorporates specific governance safeguards. Stelios Haji-Ioannou, the airline’s founder, along with his family, will retain their stake in the restructured entity, with shareholders offered options to sell or transfer up to a maximum of 49.9%.
Additionally, an EU Trust
shareholding group will hold up to 5%, a protective mechanism designed to ensure the airline maintains its operating licenses within the bloc through its Austrian subsidiary. Apollo itself will hold its equity stake at just under the regulatory threshold.
“My family and I intend to remain invested as long-term major shareholders of easyJet for the next chapter in the company’s journey.”
Stelios Haji-Ioannou, Founder
Despite board approval and the elimination of rival bids, the transaction still faces scrutiny from European regulators who are reportedly reviewing aviation ownership limits to prevent foreign entities from gaining absolute control over regional carriers.
Growth Strategy and Completion Timeline
Apollo has pledged to preserve EasyJet’s corporate headquarters in both the UK and the European Union while maintaining the carrier’s existing operational strategy. Leadership from both organizations emphasized that the backing of a well-resourced private equity partner will accelerate commercial expansion.
“EasyJet is a leader in European aviation, having built a differentiated market position through its compelling customer proposition, expansive network and strong brand.”
Alex van Hoek, European Private Equity Lead at Apollo
Chief Executive Kenton Jarvis added that Apollo’s deep sector experience would provide a stable foundation as the airline works to accelerate our growth plans
for passengers across Europe and the UK. Final completion of the transaction is formally projected to take place by the end of March 2027, subject to customary regulatory clearances.
Related reading
