EasyJet Airbus A320 aircraft seen at Malpensa Airport near Milan, Italy, on October 3, 2018.
Stefano Lerandini | Reuters
easyjet Shares soared Friday after the low-cost airline announced it was considering a $7.7 billion tender offer. Apollo Global Managementwhich will put the airline at the center of a private equity bidding war.
Under the terms of the cash offer, easyJet shareholders are entitled to receive £7.15 ($9.61) per share in the company, valuing the company at £5.7 billion (approximately $7.66 billion).
As an alternative to cash payments, Apollo will also offer shareholders the option of a stub equity alternative, or the option to “convert existing shares in EasyJet into a vehicle for the Apollo Funds to retain their investment in EasyJet.”
The terms of the alternative, under which shareholders retain voting rights, are still subject to further discussion.
The London-listed stock last traded up 13.2%. It fell 0.5% during trading on Thursday, closing at 5.88 pounds. Since the beginning of the year, the stock has increased 15.2%.
easyjet stock price
EasyJet shares soared on Monday after the airline agreed in principle to a $7.3 billion takeover offer from private equity firm Castle Lake. But the company indicated on Friday that it was reconsidering that position.
“The proposed cash offer delivers a superior outcome for easyJet shareholders by providing a higher cash value than Castle Lake’s latest offer,” easyJet said of the Apollo acquisition, noting that the board also views the offer as “an attractive combination of value, strategic alignment and long-term management of the business.”
“Accordingly, the easyJet board no longer intends to recommend the Castle Lake proposal,” easyJet said.
Castle Lake’s bid represents a cash offer of $6.90 per share, and the company has until Aug. 3 to decide whether to provide a firm commitment or walk away from the deal.
The Apollo bid is at a premium of about 22% to Thursday’s closing price.
Additionally, Apollo’s proposed price represents an 81% premium over EasyJet’s closing share price of £3.94 per share on May 28, the last business day before the start of the offer period for Castle Lake’s takeover bid.
This comes as the global aviation industry remains under pressure due to tight jet fuel supplies due to the war between the United States and Iran. The International Air Transport Association warned last month that global airline revenues are expected to halve this year due to soaring fuel costs.
EasyJet’s losses widened in the first half of 2026, with a pre-tax loss of £552m, down from a loss of £394m in the same period last year. The airline said its performance in the second half of the year so far has been affected by the Middle East conflict, with rising fuel costs and reduced forward visibility weighing on operations.
Bernstein analysts said in a note Friday morning that the Apollo acquisition increases the likelihood that easyJet’s growth path will continue as planned.
“However, in this case, closing a deal at this price would require extensive cost restructuring and margin volatility that is far greater than currently anticipated,” they added.
—CNBC’s Hugh Leask contributed to this article.
