EasyJet reaches ‘agreement in principle’ over takeover bid
EasyJet has agreed in principle with a US investment firm on a potential takeover bid worth around £5.2bn.
The low-cost Luton-based airline has previously rejected four takeover bids from Castlelake, which owns an approximately 2.14% stake in EasyJet through funds it manages.
He said those offers were worth £6.50, £5.60, £6 and £6.25 per share and had previously accused Castlelake of trying to buy it “on the cheap”.
On Sunday EasyJet’s board and Castlelake said they had agreed in principle to a £6.90 per share offer put forward on July 4.
This does not mean that a deal has been confirmed. Castlelake now needs to obtain the necessary regulatory permits and approvals for the transaction to proceed.
EasyJet is a European company, so according to EU rules it must be 51% owned by a European company.
Castlelake is a US company, but has previously outlined how it will seek to comply with this rule.
He has until 17:00 (BST) on 3 August to either definitively announce his intention to make an offer or to say he does not intend to do so.
If a proposal is made, it must be put to a vote of shareholders.
EasyJet’s board said on Sunday that the financial terms of the proposed offer “are of a value that the Board would be able to recommend to easyJet shareholders” if a firm offer were made.
EasyJet is one of Europe’s largest airlines. It employs more than 19,000 people and flies approximately 1,200 routes in 35 European countries.
It had previously said its share price had “temporarily fallen”, partly due to the impact of the US-Israeli war with Iran on the travel industry.
EasyJet shares closed at £5.58 on Friday. EasyJet’s shares had fallen more than 30% last year before news of the initial bid emerged in June.
Castlelake has $36bn (£27.3bn) worth of assets under management.
Announcing the deal in principle, easyJet said Castlelake “highlights its great respect for easyJet and its employees, as well as its intention to support its future growth and transformation into a stronger, more resilient European airline.”
