EasyJet agrees to rival £5.7bn takeover bid from US company
No-frills airline EasyJet says it has agreed in principle to a £5.7bn takeover proposal from US firm Apollo Management - just days after it had accepted an offer from a rival suitor.
The Luton-based carrier said Apollo's offer delivered "a superior outcome" to investors than the previous bid from US investment firm Castlelake that EasyJet had also agreed to in principle at the weekend.
EasyJet said Apollo's offer was worth £7.15 per share, compared with the £6.90 per share proposal from Castlelake which it said it was now "no longer minded" to accept.
EasyJet is one of Europe's largest airlines. It employs more than 19,000 people, and flies around 1,200 routes across 35 European countries.
The latest statement does not mean a deal has been confirmed. Apollo has been set a deadline of 17:00 on 7 August to either make a firm bid for EasyJet or walk away. Castlelake's deadline to make a firm offer is 3 August.
Apollo's move came after Castlelake had made a series of offers for EasyJet, which had initially been rebuffed by the carrier after it accused the US firm of trying to buy it "on the cheap".
However, on Sunday, EasyJet said it had reached an agreement in principle with Castlelake, a US investment firm, over a potential takeover offer worth around £5.2bn.
One significant regulatory hurdle to any EasyJet takeover is that European Union regulations stipulate the carrier must be majority-owned by EU citizens.
Castlelake had proposed going into partnership with two EU nationals, businessmen Peter Bellew and Mark Breen. They would own an EU-based company that would have majority control of the airline.
EasyJet said the offer from Apollo represented an 81% increase from its share price of £3.94 on 28 May, the last day of trading before the takeover interest from Castlelake was made public.
Until EasyJet reached agreement with Castlelake, it had accused the US firm of being "highly opportunistic" with its bids, arguing that its share price had been "temporarily depressed" partly due to the impact of Iran war on the travel sector.