EasyJet confirms £5.7bn Apollo takeover

British budget airline EasyJet confirmed on Thursday a recommended £5.7 billion, or $7.7 billion, cash takeover by US private equity firm Apollo after rival bidder Castlelake said it would not make a higher offer.

EasyJet said its board and Apollo had reached agreement on the terms and conditions of the acquisition. The deal is expected to complete by the end of the first quarter of 2027, and EasyJet's headquarters will remain in Luton.

Castlelake had proposed to buy EasyJet for a little over £5 billion, but said on Thursday that it did not intend to make an improved offer. Under UK takeover rules, Apollo and Castlelake had until Friday to table revised bids.

The offer price is £7.15 per EasyJet share. EasyJet shares were trading at £6.73 after the takeover confirmation.

EasyJet chief executive Kenton Jarvis said Apollo's experience in aviation made it a strong partner. Apollo manages more than $1 trillion in assets worldwide and has invested in Aeromexico, Sun Country Airlines and Atlas Air. It has also provided financing to Air France-KLM and Virgin Atlantic.

Because Apollo is a foreign entity, UK and European rules requiring airlines to be majority owned and controlled by regional nationals mean it cannot take full ownership of EasyJet outright. Apollo has said it would take the necessary steps to find a European partner.

EasyJet recently said its profit before tax fell 70 percent to £85 million in the April-June period. The airline was founded by Stelios Haji-Ioannou in the 1990s.