Apollo Global Management has agreed to acquire UK budget airline EasyJet in a deal valued at approximately $7.7 billion, following the withdrawal of rival bidder Castlelake from the takeover process [1]. EasyJet shares rose about 3.1% in afternoon trading in London on Thursday after Castlelake announced it would not proceed with its offer, which initially caused EasyJet shares to fall more than 6% before rebounding [1].
Under the terms of the Apollo deal, EasyJet investors will receive £7.15 per share ($9.63), representing a 54% premium to the airline's closing price on February 27, the last business day before the current Middle East conflict began [1]. The transaction is expected to be completed by the end of the first quarter next year [1].
Castlelake had previously tabled a bid valuing EasyJet at $7.3 billion, which was an improvement on an earlier $6.64 billion proposal rejected by EasyJet in June [1]. The private equity interest has significantly boosted EasyJet's share price, which was up nearly 50% at Wednesday's close in London [1]. EasyJet is considered an attractive takeover target due to its valuable landing slots at major European airports such as London Gatwick, Paris, and Geneva [1].
EasyJet CEO Kenton Jarvis welcomed Apollo's commitment, citing the firm's aviation experience and support for EasyJet's growth plans [1]. Apollo's Alex van Hoek emphasized EasyJet's strong market position, expansive network, and brand, and expressed pride in supporting the airline's next phase of growth and its contribution to European and UK aviation [1].
CONCLUSION
Apollo's $7.7 billion acquisition of EasyJet marks a significant development in the European aviation sector, with EasyJet shares responding positively to the news. The deal, which offers a substantial premium to shareholders, is expected to close by the end of the first quarter next year and positions Apollo as a key player in EasyJet's future growth.