EasyJet agrees to $6.7 billion takeover bid from U.S. private equity firm Castlelake
EasyJet Agrees to Acquisition by Castlelake in £5 Billion Deal
EasyJet, the U.K. budget airline, has announced that it will be acquired by U.S. private equity firm Castlelake in a deal worth £5 billion ($6.7 billion). This decision comes after EasyJet’s board of directors and Castlelake reached an agreement in principle, following the rejection of four previous bids from the firm. The news of the acquisition has caused EasyJet’s shares to surge by nearly 10% on the London Stock Exchange.
The board of EasyJet has stated that they are inclined to recommend Castlelake’s offer of £6.90 per share to the shareholders. Castlelake is required to submit a formal takeover bid by August 3 or retract its offer. In a statement, EasyJet highlighted Castlelake’s respect for the airline and its commitment to supporting its growth and transformation into a stronger European airline. Castlelake has also expressed its backing for EasyJet’s fleet modernization program, which is seen as crucial for the company’s long-term competitiveness, efficiency, and sustainability goals.
Founded in 1995 by entrepreneur Stelios Haji-Ioannou, EasyJet quickly rose to prominence with its no-frills, low-cost flights across Europe. However, in recent times, the airline has encountered challenges such as escalating jet fuel costs attributed to the Iran war, leading to a decline in profits. Despite these hurdles, EasyJet remains a dominant player with its main hub at London Gatwick Airport.
Castlelake, headquartered in Minneapolis, manages assets worth approximately $37 billion and leases a fleet of 375 planes to numerous global airlines. This strategic acquisition of EasyJet reflects Castlelake’s confidence in the airline’s potential for growth and success in the competitive European aviation market.
