A bidding war has emerged for budget airline easyJet, with both Apollo Global Management and Castlelake submitting takeover offers for the company [1]. EasyJet's stock price soared over 13% shortly after the market opened, following the announcement that the airline is considering a $7.7 billion cash takeover bid from Apollo Global Management [1]. Under Apollo's proposal, easyJet shareholders would receive £7.15 ($9.61) per share, valuing the company at £5.7 billion, or approximately $7.66 billion [1]. In addition to the cash offer, Apollo is also proposing a Stub Equity Alternative, which would allow shareholders to roll their existing holdings into the vehicle through which Apollo would own easyJet, maintaining their voting rights; however, the terms of this alternative are still under discussion [1].
The competitive landscape intensified as easyJet's shares also surged after the airline accepted a $7.3 billion takeover offer from private equity firm Castlelake [1]. Apollo's proposed offer price represents an 81% premium to easyJet's closing share price of £3.94 on May 28, the last business day before the offer period began on Castlelake's bid [1].
The market reaction has been significant, with easyJet's shares jumping more than 13% in response to the news of the competing bids [1]. The high premiums offered by both Apollo and Castlelake underscore the strategic value seen in easyJet by private equity investors [1].
CONCLUSION
EasyJet has become the focus of a high-stakes bidding war, with both Apollo Global Management and Castlelake submitting multi-billion dollar takeover offers. The news has driven easyJet shares up over 13%, reflecting strong market optimism and the substantial premiums offered by the bidders.