EasyJet agrees to £5.7bn takeover by US firm

EasyJet Accepts £5.7 Billion Acquisition Offer from American Private Equity Giant

Constantvpn.com – The British low-cost carrier EasyJet has formally agreed to a £5.7 billion acquisition by Apollo Global Management, an American investment firm, following the withdrawal of a competing bidder. This landmark deal marks a significant shift in the ownership structure of one of Europe’s most recognizable airlines and signals a new chapter for the carrier since its founding nearly three decades ago.

The acquisition comes after Castlelake, a US investment company that had been pursuing EasyJet through multiple offers, announced its decision to step aside from the competitive bidding process. Apollo’s successful bid positions the American firm as the controlling shareholder of the airline, which operates an extensive network across the continent.

Apollo’s Vision for EasyJet’s Future

Under the terms of the agreement, Apollo has committed to maintaining the airline’s workforce during its initial period of ownership. The firm has explicitly stated that it does not plan to implement any job reductions within the first twelve months following the completion of the takeover. This assurance suggests that passengers will experience continuity in service levels and route offerings during the transition period.

Apollo’s leadership has expressed strong alignment with EasyJet’s current strategic direction. The investment firm identified substantial opportunities to accelerate both operational capabilities and commercial ambitions within the EasyJet Group. According to Alex van Hoek, partner and European private equity lead at Apollo, the airline has established itself as a leader in European aviation through its distinctive market positioning, comprehensive route network, and powerful brand identity.

EasyJet’s Historical Foundation and Scale

EasyJet represents one of Europe’s largest aviation companies, employing more than 19,000 individuals and operating approximately 1,200 routes spanning 35 European nations. The carrier was established in 1995 by Sir Stelios Haji-Ioannou with a mission to provide affordable air travel options for European passengers departing from the United Kingdom.

The airline’s inaugural flights departed in November 1995, connecting Luton airport with Glasgow and Edinburgh. International services commenced the following year, expanding the carrier’s reach beyond British borders. Sir Stelios and his family continue to maintain substantial ownership, holding approximately 15 percent of the business. In a public statement regarding the acquisition, the founder expressed his support for Apollo’s growth-oriented strategy and confirmed his intention to remain a long-term major shareholder as EasyJet enters this new phase of development.

The Bidding Process and Shareholder Returns

Uncertainty surrounding EasyJet’s ownership emerged in late May when Castlelake began evaluating a potential acquisition. The US firm made several approaches to the airline, which initially rejected these proposals after EasyJet characterized the offers as undervaluing the company. By early July, both organizations had reached an agreement in principle, but Apollo subsequently entered with a more attractive proposal.

Under Apollo’s offer, EasyJet shareholders will receive £7.15 for each share they hold. Danni Hewson, head of financial analysis at AJ Bell, noted that while this price represents a substantial premium over the share price before the Iran conflict affected markets, it remains considerably below the company’s pre-pandemic valuation peaks.

Regulatory Requirements and Market Implications

The transaction must still receive approval from relevant regulatory authorities, including European Union regulators. EU rules stipulate that EasyJet’s controlling owners must be predominantly European-based. Apollo anticipates meeting this requirement by arranging for the Haji-Ioannou family and other EU-domiciled shareholders to collectively own approximately half of the business.

While Apollo has pledged not to reduce staff for at least a year following deal completion, the firm acknowledged that EasyJet may delist from the London stock exchange to become a privately held company. This transition could result in the elimination of a limited number of positions specifically related to maintaining public-listed operations, though the firm characterized these losses as confined to particular functional areas.

Hewson observed that the potential departure of EasyJet from London markets would represent a notable setback for retail investors. She emphasized that while air travel may not capture public imagination as dramatically as space exploration, everyday investors maintain a strong connection to the sector, and established names like EasyJet cannot be readily substituted in the market.

Kenton Jarvis, EasyJet’s chief executive, welcomed Apollo’s commitment to both the business and its workforce. Jarvis highlighted the American firm’s extensive experience within the aviation industry as evidence that Apollo would serve as a valuable strategic partner for EasyJet’s continued growth and development.