EasyJet reportedly said it has agreed to a significant £5.7bn takeover bid from US firm Apollo Global Management just days after executing a contract with a competitor. The carrier said Apollo’s offer achieved an optimal result compared to a proposal from US investment firm Castlelake that EasyJet had also agreed to in principle.
EasyJet is one of Europe’s largest airlines, and it employs more than 19,000 people and flies around 1,200 routes across 35 European countries. According to analysts, EasyJet is a lucrative venture due to its large aircraft fleet and valuable landing slots at major airports such as Gatwick and Paris Charles de Gaulle.
In this connection, Susannah Streeter, chief investment at Wealth Club said: “ While the carrier has been buffeted recently by higher fuel costs and geopolitical turbulence, it has built a resilient European network, a strong balance sheet and, crucially, a fast-growing holidays business. That’s likely to be one of Apollo’s biggest attractions.”
“Package holidays generate higher margins and more predictable revenues than airline tickets alone, continued.”
The latest statement released from easyJet does not mean a deal has been confirmed. A specific deadline has been set for August 7 to either submit an offer for EasyJet or walk away.
Apollo’s significant move came after Castlelake had presented a succession of proposals for EasyJet which the carrier initially rejected after accusing the US firm of trying to buy it on the cheap rate.
The company clarified that the offer from Apollo indicated an 81% increase from its share price of £ 3.94 on 28 May. Until EasyJet finalized a business deal with Castlelake, it had accused the US firm of being predatory, arguing that its share price had been depressed partly due to the impact of the Iran war on the travel sector.
