US private equity firm Apollo Global Management has gatecrashed Castlelake’s attempt at acquiring British budget carrier easyJet by tabling a 5.7 billion pound (USD 7.65 billion) offer for the airline.
The proposal placed by the Marc Rowan-led venture values easyJet at 7.15 pounds a share, above Castlelake’s 6.90-pound offer, which the British budget carrier’s board had agreed to in principle only days earlier.
Following the approach, easyJet said its board was “no longer minded” to recommend the Castlelake proposal, having unanimously concluded that Apollo’s terms were more attractive to shareholders.
Shares in easyJet jumped as much as 15% on Friday (July 10) to 6.75 pounds, the airline’s highest level since February 2022. However, the ratio was still below Apollo’s offer price. The stock has risen 81% since May 28, the last trading day before Castlelake’s interest became public.
Apollo said it was committed to taking “all necessary steps” to satisfy the European Union’s (EU) merger control and foreign-ownership rules, which require European airlines to remain majority-owned within the bloc even after Brexit.
It has also offered eligible shareholders the option to include/transfer their stakes into the private vehicle that would buy the budget carrier, as the avenue will enable them to continue to own their voting rights. The firm must announce a firm offer by August 7 or walk away, while Castlelake’s deadline falls on August 3.
Apollo said it backed easyJet’s existing strategy of strengthening its low-cost model, including fleet upgrades and expansion of its holidays business, and intended to retain management and staff.
It also plans to preserve the brand license agreement with founder Sir Stelios Haji-Ioannou, who holds roughly 15% of the airline with his family, apart from receiving a 0.25% royalty on easyJet’s revenue for the use of the “easy” brand.
As an alternative to cash, Apollo has offered shareholders the option to roll their stakes into the acquisition vehicle, retaining voting rights.
Castlelake, which went public with its interest in May 2026 after facing early rejections from the board, has partnered with two EU nationals, Peter Bellew and Mark Breen, to meet ownership rules through a separate holding company.
The bidding war comes as the wider aviation sector faces pressure from higher fuel costs following the Iran war. The budget carrier reported a pre-tax loss of 552 million euro for the first half of 2026, widening from 394 million euro a year earlier, though analysts said its profitable network and growing holidays business made it an attractive target for private equity.
“It’s no surprise that a second suitor has appeared for easyJet. The potential for the business remains substantial despite the underwhelming performance of recent years,” said Chris Beauchamp, chief market analyst at investing and trading platform IG.
Stephen Furlong, analyst at Davy Group, Ireland’s leading provider of wealth management and investment banking services, feels that while both Apollo and Castlelake proposals could ultimately gain regulatory approval, the acquisition price will now take the center stage, with the bidding war expected to become a hot one in the coming days.
While Castlelake has remained silent on specific business reorganization plans for easyJet beyond a broad commitment to support the airline’s fleet modernization program, Apollo has laid out its roadmap clearly: retain the airline’s key staff to continue easyJet’s strategy of expanding capacity and growing its holidays business.
And it looks like easyJet has found more solace with Apollo’s bid, as both businesses said in a joint statement, “The proposed cash offer delivers a superior outcome for easyJet shareholders by providing a higher cash value than Castlelake’s latest proposal.”
As per analysts, easyJet’s extensive fleet of over 350 aircraft and well-established model provide an excellent business opportunity for its suitors.