LONDON – EasyJet received an offer from private equity firm Apollo Global Management for 715 pence a share that beats a rival proposal from Castlelake, a surprise twist in the takeover saga that sets up a possible bidding war between the two US investment funds.
The two bids come at a time when EasyJet and other airlines face soaring jet fuel prices and suppressed demand after the Iran war. The carrier reported a drop in summer bookings as well as a loss in the first half of 2026.
Given that Apollo’s £5.7 billion (S$9.9 billion) bid is superior to Castlelake’s £5.5 billion offer, the budget carrier is “no longer minded to recommend the Castlelake proposal,” according to a statement by the discount airline on July 10. With regards to Apollo’s bid, “the financial terms of the proposed cash offer are at a level that it would be minded to recommend to EasyJet shareholders,” it said.
Castlelake said it’s evaluating its options following Apollo’s bid. The company is operating under an Aug 3 deadline for a firm offer, whereas Apollo has until Aug 7 to formalise its bid or walk away.
The sudden arrival of Apollo as an interloper follows multiple rounds over the past month between EasyJet and Castlelake, which continuously raised its bid to keep talks going. It took Castlelake five attempts and an offer for 690 pence a share to convince EasyJet to open its books, and the investor now needs to determine if it can come back with an even higher figure to outrun Apollo.
EasyJet rejected Castlelake’s first four bids, calling them “highly opportunistic” and saying the US firm was trying to buy the airline “on the cheap.” This time, EasyJet agreed in principle to the first offer made by Apollo, which said it has long admired the airline and the brand, and described the carrier as one of the most attractive companies in the industry.
Castlelake still retains a possible edge since it was granted access to EasyJet’s books following its latest overture. The investment firm has also provided greater detail on its bid structure, with former EasyJet executive Peter Bellew forming part of a European management duo that would hold the majority. The bidding group also includes Brookfield Asset Management.
EasyJet shares surged 14.1 per cent to 671.31 pence in London on July 10. The shares haven’t traded at the level most recently proposed by Castlelake, suggesting investors were holding out for more money or doubting the deal would overcome regulatory hurdles.
At the price Apollo is now offering, “a heroic cost restructuring and earnings inflection, far above what we currently forecast, would be required for the deal to make sense,” said Alex Irving, an aviation analyst at Bernstein.
Apollo sought to dispel concern the airline would be broken up under a private owner, given that the individual parts of EasyJet are much more valuable than the current business. The firm said it “places a high value on people,” and it will be important to identify and retain key employees across the EasyJet group.
Apollo said it would seek to satisfy the necessary condition for overseas investors to control a European airline. As US entities, neither investment firm can take full control of EasyJet because the airline operates under UK and European rules that require majority ownership and control by regional nationals. So Apollo also needs a European partner.
Both Castlelake and Apollo have experience in the aviation industry. Castlelake has financed aircraft leases and was previously a co-investor in Air France-KLM’s takeover of Scandinavian carrier SAS.
Apollo runs an aircraft and aviation financing business that includes a leasing, management, and finance company operating out of New York, Dublin and Singapore. It has also invested in Sun Country Airlines, Aeromexico and Atlas Air Worldwide Holdings, one of the world’s biggest air cargo operators.
Combined, the Apollo aviation platform finances more than 360 commercial aircraft and more than 60 engines, according to the company. BLOOMBERG
