The new offer at 6.90 pounds a share represents a 73% premium to easyJet’s closing price on May 29, when the private equity fund manager disclosed its interest in the airline to British regulators. Since then, as the takeover talks held ground, the shares went up steeply as well. As per the latest updates, the budget carrier’s shares rose 10% during trading at London, hitting 6.16 pounds.

Castlelake’s successful offer also gives easyJet an equity value of 5.23 billion pounds (USD 6.98 billion), rising to 5.52 billion pounds on a fully diluted basis. The bid is 24% above easyJet’s closing price on Friday (3rd July).

The deal, which would see the American investor take 31-year-old easyJet private, coincides with operating challenges for airlines globally as they grapple with sharply higher ⁠fuel prices and profit pressure due to the Iran war. So severe were the disruptions that they forced budget carrier Spirit Airlines to file for bankruptcy in the United States.

Locked in fierce competition with rival Ryanair, easyJet had long been viewed as a takeover target with its valuable landing slots at airports, including London Gatwick, Paris, and Geneva, which made the entity attractive to potential bidders.

The carrier in June rejected a 4.93 billion pound proposal from Castlelake but signaled an interest in continuing talks by granting the private equity manager limited access to the venture’s commercial data.

On Sunday (July 5), easyJet’s board said that the latest bid was at “a value that the board would be minded to recommend to easyJet shareholders.” However, it has put the ball firmly in Castlelake’s court by asking the latter to submit its firm intention to make an offer by August 3. Castlelake, an established lender to the global aviation sector, apart from leasing airplanes to about 200 airlines, will now have to meet the European Union’s (EU) regulations requiring airlines operating in the bloc to be majority owned and controlled by EU nationals.

“The financial terms of the proposed offer are at a value that the board would be minded to recommend to easyJet shareholders should a firm offer be made,” the company said.

Castlelake, during one of its failed bids, said it would own 49% of the investment vehicle with the remainder held by two EU nationals, former Malaysia Airlines CEO Peter Bellew ⁠and senior industry executive Mark Breen. Bellew was easyJet’s chief operating officer from 2019 to 2022. Breen, on the other hand, runs an aerospace consultancy and has previously held senior roles at a number of airlines, including the ones in the Middle East.

EasyJet, which flies low-cost routes in 38 European countries, operates 355 aircraft across more than 1,200 routes. The business, since the COVID-19 pandemic, has failed to recover financially, despite having bright spots like package holiday business and an efficient Airbus ⁠fleet.

British-Cypriot entrepreneur Stelios Haji‑Ioannou, who established easyJet in 1995, left the board in 2010 but remains the biggest investor with a roughly 15% stake alongside his family.

The British market is on course to set a mergers and acquisitions record in 2026 as weaker valuations among London-listed companies attract buyers. EasyJet initially said Castlelake’s approach was “highly opportunistic” as the Iran war turmoil depressed its shares.

Former aviation executive John Strickland, while interacting with the BBC, has said that in addition to being a “profitable, successful airline,” easyJet also has attractive features like high brand recognition.

“Looking at the business itself, it has a substantial fleet of aircraft, numbering over 350 planes, and a massive order book—aircraft slots on production lines are hard to get your hands on. In addition, they have a very strong slot position at a number of large, congested airports around Europe, including Gatwick and Paris Charles de Gaulle. The most popular slots can be worth tens of millions of pounds when traded between airlines,” Strickland told the BBC’s “Today” program.

He doesn’t see CastleLake slimming down EasyJet’s organizational structures. Castlelake has assets under management worth USD 36 billion (27.3 billion pounds).

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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.

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Minneapolis-based Castlelake, which manages about USD 38 billion in assets and has invested over USD 24 billion ⁠into the aviation sector since 2005, said the latest move would allow easyJet shareholders to consider the bid’s merits and relay their views to the low-cost carrier ahead of a June 26 deadline for a formal offer.

Castlelake’s 6.25-pound-per-share proposal represents a premium of about 57% to ‌easyJet’s ⁠share price of 3.94 pounds on May 29 before the American venture disclosed its interest in the low-cost carrier. The two previous failed bids had figures worth 5.6 euro and 6.0 euro, respectively.

Castlelake also said its arrangement for easyJet’s ownership takeover ⁠is consistent with those adopted by other European airlines to ensure full regulatory compliance on the continent.

The venture also plans to offer a partial equity alternative so that easyJet shareholders ⁠remain invested in the airline as a privately held business in partnership with the alternative investment fund, subject to a maximum participation limit.

As per the European Union’s (EU) rules, any move by Castlelake to acquire easyJet would have to meet the politico-economic union’s ownership requirements, despite the budget carrier being based in the non-member nation called the United Kingdom.

The reason lies behind easyJet’s move of establishing an EU-based subsidiary, “EasyJet Europe,” to maintain access to the intra-EU aviation market. As per the EU rules, Castlelake would need to ensure that the ownership criteria are preserved, any violation of which will bring the risk of losing traffic rights in the continent.

To deal with this, Castlelake has brought Bellew, along with Mark Breen (Managing Director at Quinbrook Infrastructure Partners), two prominent European citizens, as the individual investors for the takeover deal.

While Bellew, apart from being an easyJet veteran, held a leadership role in Ryanair too, Breen has held senior board roles at budget carrier Flyadeal and other airlines (notably in the Middle East). Breen also founded the Irish-based consultancy Oneiros Aerospace.

As per Castlelake, Bellew and Breen would invest and participate in the proposed acquisition of easyJet through their ownership and control of an EU-domiciled company, which would have a majority share in the overall structure.

“Bellew has recently made investments in EasyJet with the acquisition of a relatively small number of shares over the course of March-May. This proposed structure is consistent with structures adopted by a number of other European airlines that are subject to the same EU ownership rules as [EasyJet]. [We are] highly confident that the transaction will be structured and completed in full compliance with all applicable regulatory requirements, with any required formal approvals obtained swiftly,” the alternative investment fund remarked further.

It also cited easyJet’s “unwillingness to engage meaningfully” as a reason for going public with the bid.

While Castlelake said it aims to support easyJet, respecting its “valuable” assets and sustaining its network, the low-cost carrier, in response, stated that 51% of the proposed ownership vehicle would be held by EU interests, including potential investors whose identities have not been disclosed, apart from describing the structure as “opaque.”

“The Board believes that the Third Proposal represents an opportunistic attempt to acquire easyJet ‘on the cheap,’ and that it is therefore not in the best interests of easyJet shareholders,” the budget carrier said in a statement.

EasyJet also reiterated that it was focused on its medium-term targets, apart from growing its holidays business, ‌which ⁠has accounted for a steady increase in share of profit despite geopolitical uncertainties.

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