In a bold move, US investment firm Castlelake has made public its £4.7 billion bid for easyJet, following the airline’s rejection of its third offer amid a fierce takeover contest. The latest proposal, valuing easyJet at 625 pence per share, comes after two previous bids at 560p and 600p were turned down. Castlelake expressed its hope that by disclosing the offer, shareholders would have the chance to evaluate its potential before the looming June 26 deadline.
Based in Minneapolis and managing assets worth approximately $36 billion, Castlelake voiced its frustration over easyJet’s board’s reluctance to engage constructively with its offers. To comply with European regulations that mandate EU airlines to be majority-owned by European investors, Castlelake has joined forces with aviation experts Peter Bellew and Mark Breen. Their strategy involves an EU-controlled entity maintaining a controlling stake in easyJet.
Despite this strategic maneuvering, easyJet firmly rejected the proposal, characterizing it as an opportunistic attempt to acquire the airline at a reduced valuation. The company argued that the offer was made during a period of geopolitical uncertainty that has suppressed its share price, and it does not accurately reflect easyJet’s long-term growth prospects. Moreover, easyJet raised concerns about the transparency of Castlelake’s proposed ownership structure, claiming it undervalued the airline’s business and future potential.
Investor interest in easyJet has surged amid the takeover speculation, resulting in a notable market performance boost. Over the past month, the airline’s shares have climbed approximately 40% and continued to rise following Castlelake’s announcement. EasyJet, headquartered in Luton, holds a significant position in the European budget airline market, ranking behind Ryanair but ahead of Wizz Air.
As the June 26 deadline approaches, Castlelake faces a critical decision: whether to submit a formal takeover offer or to abandon the effort altogether. The unfolding situation remains closely watched by investors and industry analysts alike as the battle for control of one of Europe’s largest low-cost carriers intensifies.