Easyjet accepts rival takeover bid from US investor Apollo worth £5.7bn
Easyjet has asked investors to accept a rival takeover offer from another US investor worth £5.7bn as it plans to exit the London market.
budget The airline, founded by Sir Stelios Haji-Ioannou in 1995, said earlier this week that it had reached an agreement ‘in principle’ with US investment giant Apollo, overshadowing Castlelake’s offer.
“The proposed cash offer delivers a superior outcome for easyJet shareholders, providing a higher cash value than Castlelake’s last offer of £6.90 per easyJet share,” the London-based airline said in a statement.
The shares rose 13.3 per cent to 666 pence in early trading, taking its total gain this year to 29.7 per cent.
Easyjet accepted a £5.5bn takeover offer in principle from US investor Castlelake on Sunday, then received a better offer from Apollo on Wednesday.
For sale: Easyjet accepted a takeover offer in principle earlier this week before being eclipsed by Apollo
Apollo’s offer of £7.15 per share represents an 81 per cent premium over Easyjet’s closing price of £3.94 before Castlelake’s offer.
If Apollo’s bid is successful, it will add to the asset manager’s growing airline portfolio. The company, which also partly owns Atlas Air, last year loaned $745 million to Virgin Atlantic through its private lending arm for takeoff and landing sites at Heathrow airport.
Apollo must announce a firm offer for Easyjet by August 7 or walk away. Castlelake has until August 3rd.
Easyjet had rejected four of Castlelake’s previous offers, with the airline’s bosses describing the previous offers as ‘highly opportunistic’ and accusing the firm of trying to get a ‘cheap’ deal.
This represents another blow to the London stock exchange, which has been subjected to frenzied buying activity by foreign buyers. Other companies targeted include Tate & Lyle, owner of Beazley, Schroders and William Hill.
FTSE100 Warehouse firm Segro this week rejected an ‘opportunistic’ offer worth £12.6bn from US firm Prologis, but did not rule out a ‘more attractive’ sale.
Easyjet has long been seen as a takeover target as its share price collapsed in the wake of the pandemic and its recovery has lagged behind its European rivals.
Any bid for Easyjet is likely to require the support of Easyjet founder Sir Stelios and his family, who currently hold a 15.3 per cent stake in the company.
Although the family have not commented publicly, sources told the Mail last month he was likely to accept an ‘eye-watering’ offer.
“It would have to be an eye-wateringly high price to persuade him and his family to sell,” the source told the Mail.
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