EasyJet has described a potential £3bn takeover approach by US investment group Castlelake as 'highly opportunistic', as shares in the airline surged to their highest level in three months. The Luton-based carrier said the bid timing was opportunistic, citing a temporarily depressed share price due to the Middle East situation and its impact on customer confidence and fuel costs.
Castlelake, a private credit firm managing $36bn in assets, revealed on Friday it was considering an offer and had already acquired a 2.14% stake. The potential bid values easyJet at a minimum of 403p per share, or about £3bn overall. However, easyJet's shares jumped as much as 12% on Monday to 444.7p, above the offer threshold, before closing up around 10%.
EasyJet stated it would consider any formal proposal but highlighted 'considerable regulatory, financial and other execution challenges'. Under EU rules, European airlines must be majority-owned by regional investors, which could complicate a Castlelake takeover. RBC Capital Markets analyst Ruairi Cullinane noted this could be problematic if Castlelake acts alone.
This is not the first time easyJet has attracted suitors; MSC considered a bid in October, and the airline rejected an approach from Wizz Air in 2021. Founder Stelios Haji-Ioannou, who remains the largest shareholder with a 15% stake, declined to comment. Castlelake already has ties to the industry through loans to SAS and Virgin Atlantic.
Susannah Streeter of Wealth Club said the bid suggests Castlelake believes the market underestimates easyJet's long-term earnings potential. The approach adds to a string of high-profile exits from the London Stock Exchange, including Ashtead, Flutter Entertainment, and CRH, highlighting concerns over UK market valuations.
