easyJet confirmed it has agreed in principle to Castlelake's revised takeover offer of £6.90 per share, a boost from the previous £6.50 bid. The budget airline's board recommended the improved proposal to shareholders, marking a major step toward resolving months of acquisition negotiations.
Castlelake, a London-based investment firm, upped its offer by 6 percent after easyJet's board rejected earlier proposals as undervaluing the company. The new bid values easyJet at approximately £1.68 billion. The airline's independent board committee, chaired by John Barton, deemed the revised terms fair and reasonable for shareholders.
The agreement remains subject to customary closing conditions, including regulatory approvals and a shareholder vote. easyJet operates over 300 aircraft across Europe and serves 120 million passengers annually. The company's valuation reflects travel sector volatility following the pandemic, when airlines faced severe operational and financial pressures.
The takeover follows a period of strategic uncertainty for easyJet. The airline had faced activist pressure and shifting market conditions that prompted board-level discussions about strategic alternatives. Castlelake's acquisition strategy focuses on investing in transport and logistics infrastructure, making easyJet a natural fit for the firm's portfolio expansion.
The £6.90 price represents a significant premium to easyJet's closing price before takeover rumors emerged. This premium reflects Castlelake's confidence in easyJet's long-term earnings potential and European aviation recovery. Shareholders will ultimately decide whether to accept the offer at a forthcoming shareholder meeting.
Regulatory authorities in the UK and EU must approve the transaction given easyJet's operations across multiple European jurisdictions and Castlelake's ownership structure. Antitrust reviews will examine whether the acquisition creates competition concerns in key European aviation markets where easyJet operates major hubs.
The deal timeline remains uncertain pending shareholder approval and regulatory clearance. Investment banks advising both parties have indicated the transaction could close within six to nine months if approvals proceed without major obstacles. easyJet shares rallied on the news, as investors priced in the higher offer and assessed closing probabilities.
This transaction underscores continued consolidation appetite in the airline sector despite macroeconomic headwinds and rising fuel costs. Castlelake's purchase demonstrates investor confidence in easyJet's operational model and recovery trajectory as European travel demand rebounds post-pandemic.