US investment firm Castlelake has disclosed a £4.7 billion takeover proposal for easyJet, following the airline’s rejection of three successive offers. The latest bid from Castlelake, an all-cash proposal, values easyJet shares at 625 pence each, an increase over previous offers of 560p and 600p. By making this proposal public, Castlelake aims to allow shareholders an opportunity to evaluate the offer’s advantages ahead of the June 26 deadline for the takeover.
Based in Minneapolis, Castlelake oversees assets worth approximately $36 billion and has expressed dissatisfaction with easyJet’s board for its lack of engagement with the firm’s proposals. In an attempt to align with European ownership rules, which mandate that EU airlines remain primarily owned by European investors, Castlelake has joined forces with aviation executives Peter Bellew and Mark Breen. Their plan includes an EU-controlled entity maintaining majority ownership of the airline.
EasyJet, however, has dismissed this proposal, labeling it as an opportunistic move to acquire the airline at a lower valuation. The company argues that the offer comes at a time when its share price is adversely affected by geopolitical instability, and thus does not accurately represent its potential for long-term growth. Additionally, easyJet has raised concerns about the clarity of Castlelake’s proposed ownership model, insisting that the offer significantly underappreciates the airline’s value and future outlook.
Despite easyJet’s firm rejection, speculation surrounding the takeover has positively impacted the airline’s market performance, with shares climbing approximately 40% over the past month. This boost continued as Castlelake’s announcement further fueled investor interest. EasyJet, headquartered in Luton, stands as one of Europe’s leading budget airlines, positioned between Ryanair and Wizz Air in the low-cost carrier sector.
As the June 26 deadline approaches, Castlelake faces the decision of whether to present a formal takeover offer or withdraw from the pursuit. The unfolding situation continues to draw attention as stakeholders await the next move in this growing takeover saga.