easyJet has agreed to a £5.7 billion cash takeover by US investment group Apollo after rival bidder Castlelake withdrew from the contest for the British low-cost airline.
Founder Sir Stelios Haji-Ioannou has backed the transaction and confirmed that he and his family will retain a significant stake in the privately owned company that will emerge following easyJet’s departure from the London Stock Exchange.
Apollo and easyJet reach agreement
“The boards are pleased to announce that they have reached agreement on the terms and conditions of a recommended cash acquisition,” easyJet said in a statement on Thursday.
The deal values the airline, which operates primarily across Europe, at £5.7 billion, equivalent to approximately $7.7 billion.
easyJet said last month that Apollo’s preliminary proposal offered a “better outcome” for shareholders than the competing bid from Castlelake, which valued the airline at slightly more than £5 billion.
Under UK takeover rules, Apollo and Castlelake had until Friday to submit revised offers. Castlelake ended the bidding contest on Thursday, confirming that, “after careful consideration”, it did not intend to make an improved offer for easyJet.
Ownership rules remain a factor
Apollo manages more than $1 trillion in assets worldwide and already has extensive interests in aviation. It has invested in Aeromexico, Sun Country Airlines and Atlas Air, while also providing financing to Air France-KLM and Virgin Atlantic.
As a US company, however, Apollo cannot assume unrestricted ownership and control of easyJet. UK and European Union aviation rules require airlines to remain majority-owned and effectively controlled by eligible nationals.
The structure of the transaction will therefore need to comply with those requirements.
Sir Stelios backs the takeover
Sir Stelios said he had carefully evaluated Apollo’s proposal before deciding to support the agreement on the terms presented by easyJet’s Board of Directors.
He described Apollo as one of the world’s strongest institutional investors and said its decision to invest in easyJet represented a “strong endorsement” of the brand’s value and the easyGroup business model.
Sir Stelios also expressed confidence that the transaction could create new opportunities for the airline’s development. He stressed that he and his family would continue supporting easyJet’s future as long-term shareholders.
From 19 aircraft to around 356
Sir Stelios founded easyJet in 1994 at the age of 27, marking the beginning of what later became the wider easy family of brands.
The airline joined the London Stock Exchange in 2000 to finance its expansion. Its fleet has since grown from 19 aircraft at the time of the listing to approximately 356 today.
Sir Stelios said one of his key strategic decisions was to retain ownership of the easyJet trademark through the privately held easyGroup Ltd. According to the founder, this created a stable source of revenue that now also supports the charitable work of the Stelios Philanthropic Foundation.
