EasyJet said on Sunday it has agreed in principle to a takeover by Castlelake, the U.S. investment firm, capping weeks of resistance with a cash deal that values the British budget airline at £5.23 billion.
The Minneapolis-based private credit firm offered £6.90 per share in cash, giving the airline an equity value of about £5.2 billion, or £5.5 billion on a fully diluted basis. In its statement, EasyJet said its board concluded the fifth proposal had reached a level it “would be minded to recommend” to shareholders after reviewing the offer with its advisers.
The agreement followed weeks of negotiations. Castlelake first approached the airline on May 29 with an offer of 560 pence per share, gradually increasing the bid to 690 pence. EasyJet rejected the earlier proposals, calling them “highly opportunistic” and arguing they undervalued the company. Even after turning down a £4.93 billion offer last month, the airline agreed to provide limited commercial information so discussions could continue.
The timing proved significant. Castlelake launched its bid as EasyJet faced higher jet fuel costs and softer travel demand following the U.S.-Iran war and disruptions to shipping through the Strait of Hormuz. The airline’s shares closed Friday at 558.2 pence, roughly 20% below the takeover price, making the offer increasingly attractive despite the board’s earlier resistance.
Not all investors are convinced. Some shareholders had hoped for at least £7 per share, raising questions about whether the final proposal will receive enough support. The companies have extended the UK’s “put up or shut up” deadline until 5 p.m. London time on August 3, allowing additional time to finalize the transaction.
To satisfy European airline ownership rules limiting non-EU control, Castlelake structured the bid with EU-based partners, including Brookfield, along with aviation executives Mark Breen and Peter Bellew. Bellew, a former EasyJet chief operating officer, left the airline in 2022. Castlelake said it intends to invest in the carrier’s long-term growth and fleet modernization.
For travelers, ownership changes rarely affect flights immediately, but they can reshape an airline over time. Private equity owners often streamline operations, adjust route networks and renegotiate aircraft purchases, decisions that ultimately influence ticket prices, schedules and expansion plans. As one of Europe’s largest low-cost carriers, EasyJet’s future strategy could affect millions of passengers.
The proposed acquisition also adds to concerns over the shrinking number of major companies listed on the London Stock Exchange. If the deal closes, EasyJet would become another well-known British company to leave the public market, continuing a trend that has drawn growing attention from UK policymakers seeking to strengthen London’s position as a global financial center.
JBizNews Desk | London
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