Continuing its defiance against the United States-based Castlelake, British budget carrier easyJet has said it would grant the American alternative investment firm “limited access” to the carrier’s commercial data, in what seems to be, as per the company, a tactic to draw a higher takeover bid. On Thursday (June 25), the low-cost airline rejected a fourth takeover proposal from Castlelake that was valued at 4.93 billion pounds (USD 6.5 billion).
Shares of easyJet, which operates more than 350 aircraft on over 1,200 routes in 37 countries, on 25th June, jumped by as much as 8% to around 5.80 pounds. Still, they were below Castlelake’s latest offer of 6.50 pounds per share.
While rejecting Castlelake’s fourth bid, the budget carrier’s board unanimously accused the American firm of attempting to undervalue the airline. As per them, giving Castlelake limited access to easyJet’s books might produce a “more attractive proposal.”
“While the latest proposal was higher than Castlelake’s previous 6.25-pound-per-share offer, it is also tracking towards the 7-pound-apiece price tag easyJet investors were hoping to get,” reported the Financial Times (FT).
As per Dudley Shanley, an analyst with Goodbody Stockbrokers, the latest move from the easyJet board has now ensured that the carrier is willing to enter serious negotiations with Castlelake, eyeing a sale at the right price.
Castlelake’s deadline to table a firm offer for easyJet’s acquisition has been extended to July 5 under the United Kingdom’s takeover rules. And as per the budget carrier, the American alternative investment fund had indicated it hoped to further improve its bid following limited access to easyJet’s commercial information.
While Castlelake has “welcomed” the constructive engagement from the easyJet board and the deadline extension, analysts are unsure about whether the American alternative investment firm could structure a deal that would comply with European Union (EU) ownership rules requiring carriers to be majority EU-owned and controlled while also satisfying easyJet investors on price.
Samuel Ziff, a portfolio manager at Oldfield Partners, an easyJet investor, said that any new bid price would need to be “significantly higher” than the rejected proposal.
“EasyJet has got a very valuable fleet; they’ve got very valuable slots, and management has got this clear target that they want to hit by 2030 in terms of profitability,” Ziff told Reuters.
Castlelake has also named New York-based Brookfield Asset Management as a co-investor, along with two previously disclosed partners, former Malaysia Airlines CEO Peter Bellew (a former easyJet employee) and senior industry executive Mark Breen.
Under the proposed terms, the bidding vehicle would be owned 49% by Castlelake and co-investors, including Brookfield. The remaining 51% would be owned by EU nationals Bellew and Breen.
“The reality is price is much more important than who’s actually buying. Concerns over ownership structure and an absence of a European airline investor might be ignored for the right price,” Shanley said.
Brookfield, in 2025, was also part of a consortium that acquired one of the world’s largest aircraft lessors, Air Lease, in a USD 7.4 billion cash deal.
EasyJet, which competes with other low-cost carriers such as Ryanair, hit the warning bells in May by informing its investors that its full-year forecast remained uncertain due to factors like higher jet fuel costs and disappointing summer bookings since 2025.