US investment firm Castlelake has made public its £4.7 billion proposal to acquire easyJet, escalating the ongoing takeover battle as the airline rejected this third bid. The all-cash offer from Castlelake values easyJet at 625 pence per share, following earlier bids of 560p and 600p that were also turned down. Castlelake’s decision to go public with the proposal aims to give shareholders the opportunity to evaluate the offer’s merits ahead of the June 26 deadline for the takeover.
Castlelake, based in Minneapolis and managing approximately $36 billion in assets, expressed disappointment over what it perceives as a lack of meaningful engagement by easyJet’s board with its proposals. In a move to comply with European ownership regulations, which stipulate that EU airlines must remain majority-owned by European investors, Castlelake has teamed up with aviation executives Peter Bellew and Mark Breen. Under their plan, an EU-controlled entity would hold a majority stake in easyJet.
EasyJet, however, has firmly rejected the proposal, labeling it as an opportunistic attempt to acquire the company at a discounted value. The airline contends that the offer was made during a period of geopolitical uncertainty affecting its share price, and it does not reflect the company’s long-term growth potential. Additionally, easyJet has raised concerns about the transparency of Castlelake’s proposed ownership structure, arguing that the offer undervalues the business and its future prospects.
Despite the airline’s rejection of the offer, speculation over a potential takeover has positively impacted easyJet’s market performance, with shares rising approximately 40% over the past month. Following Castlelake’s announcement, easyJet’s shares continued to trade higher. As one of Europe’s largest budget airlines, easyJet is headquartered in Luton and ranks behind Ryanair but ahead of Wizz Air in the low-cost carrier market.
With the June 26 deadline approaching, Castlelake must now decide whether to proceed with a formal takeover offer or abandon the deal altogether.