Apollo agrees £5.7bn take-private of easyJet
Deal Snapshot
Apollo Global Management (NYSE: APO) has agreed to acquire easyJet plc (LSE: EZJ), Europe’s second largest low-cost carrier, for £7.15 per share in cash. The firm offer was announced on 6 August 2026, the same day rival bidder Castlelake, L.P. withdrew from a contest that had run since late May. The offer values easyJet’s capital at approximately £5.7 billion, or around $7.7 billion.
Apollo and easyJet expect completion by the end of the first quarter of 2027, subject to a shareholder vote, court sanction and an unusually long list of regulatory clearance, easyJet remains listed and independently managed until then.
The price beats Castlelake’s final proposal of £6.90 by 25 pence per share and represents an 81% premium to easyJet’s closing price of £3.94 on 28 May 2026, the last business day before Castlelake’s interest became public. Eligible shareholders may elect a stub equity alternative instead of cash, exchanging their holding one for one into unlisted shares into the vehicle Apollo would hold the investment in easyJet.
Acquirer: Apollo Global Management, through Eagle Bidco Limited
Target: easyJet plc (LSE: EZJ)
Agreement: 10 July 2026
Firm offer (Rule 2.7): 6 August 2026
Expected completion: end of Q1 2027
Consideration: £7.15 per share in cash, with a stub equity alternative
Equity value: £5.7bn on an issued and to be issued basis (£5.4bn on the 758m shares currently in issue)
Implied enterprise value: £5.3bn, after £434m of net cash at 31 March 2026
Premium: 81% to the 28 May 2026 close
Financial advisers to easyJet: Evercore (lead), BNP Paribas (adviser and corporate broker)
Financial advisers to Apollo: Barclays (lead), PJT Partners, Citigroup
Legal counsel: Clifford Chance (easyJet), Paul, Weiss (Apollo), Slaughter and May and Milbank (Castlelake)
Players
Apollo Global Management (NYSE: APO) is a New York based alternative asset manager built around credit, private equity and retirement services (Athene). Its balance sheet and fund capital are increasingly directed at large, asset-heavy businesses that generate contractual cash flows, and aviation has been a recurring theme: Apollo has previously invested in Aeromexico, Atlas Air and Virgin Atlantic, and runs an aircraft leasing and financing platform, Perseus Aviation.
easyJet plc (LSE: EZJ) is a UK low-cost airline founded in 1995 by Sir Stelios Haji-Ioannou and headquartered at London Luton. It flies an Airbus A320 family fleet across a network built on primary airports, where it typically holds a number one or number two position, and it operates through three air operator certificates: easyJet UK, easyJet Europe (Austria) and easyJet Switzerland. Alongside the airline sits easyJet holidays, a package holiday business that has grown into a meaningful second earnings stream. The airline does not own the “Easy” brand. It licenses the "easy" brand from easyGroup, Stelios’ private vehicle, in exchange for a royalty of 0.25% of revenue.
Castlelake, L.P., the losing bidder, is a Minneapolis based alternative investment manager founded in 2005 and specialised in asset-based private credit, with aviation as its core competence. Its heritage is in aircraft and aviation lending rather than in operating airlines.
Apollo Global Management
Assets under management: $1.03 trillion (31 March 2026)
Revenue (FY 25): $32.4bn
EBITDA (FY 25): $8.37bn
Employees: ~5,700
Enterprise Value: $83.6bn (as of 08/10/2026)
Market Cap: $75.2bn (as of 08/10/2026)
Founded: 1990
HQ: New York, New York
easyJet plc
Market Cap before bid: £3.0bn (£3.94 share price)
Equity value at the offer price: c. £5.7bn
Implied enterprise value: £5.3bn
Revenue (FY2025): £10.10bn
EBITDA (FY2025): £1.44bn
Net Income: £494m
Employees: c. 19,000
HQ: Hangar 89, London Luton Airport, Luton, UK
The Backstory
The bid arrived at easyJet’s weakest moment in years. The conflict in the Middle East had pushed fuel prices sharply higher, forward bookings had softened, and the airline had guided to a first-half headline loss before tax of £552 million, £158 million worse than the same period a year earlier. The shares, which had traded at £8.20 in 2021, closed at £3.94 on 28 May 2026, having lost roughly 40% of their value over the preceding twelve months and leaving a business generating over £10 billion of revenue valued at around £3 billion.
Castlelake disclosed on 29 May that it was in early stages of considering an offer. easyJet’s board called the approach highly opportunistic and rejected it, then rejected the three that followed (600p on 17 June, then 625p and 650p). The pivotal moment came on 25 June, when the board opened limited commercial information to Castlelake, implying the board was prepared to transact at the right price. A fifth proposal at 690 pence followed on 4 July, and on 5 July easyJet announced it was minded to recommend it.
However, on 8 July, without any prior public disclosure, Apollo submitted a proposal at 715 pence per share. easyJet’s board reached an agreement in principle within 48 hours and announced on 10 July that it was no longer minded to recommend Castlelake’s offer.
The Takeover Panel then aligned the two “put-up-or-shut-up” deadlines so that both bidders had to declare on the same day. Castlelake, which had raised its price five times but never obtained full due diligence access, chose not to go a sixth time, on 6 August it confirmed it would not make an offer. Apollo announced its firm offer the same day, with the unanimous recommendation of the easyJet board.
Deal Rationale
For Apollo, the appeal is a franchise that cannot be rebuilt from scratch. easyJet holds slots at capacity-constrained primary airports, a network of 1,267 routes, a holidays business that hit its £250 million profit target five years early, and an A320neo order book placed before list prices rose. Apollo says it backs the existing low-cost strategy rather than pursue a break-up.
Timing is also a factor of great importance. Apollo is buying a structurally advantaged asset at a cyclical trough caused by a fuel shock, at roughly 3.6 times trailing EBITDA, against a company target of more than £1 billion of profit before tax.
For easyJet's board, the question was less whether to sell than at what price and to whom. Beyond the 25 pence, two things separated the bidders. Castlelake's background in aircraft leasing made an asset-driven break-up credible, while Apollo committed to keeping the business whole. Furthermore, Apollo committed to leaving the easyGroup brand licence unchanged. The board also cited deliverability, pointing to Apollo's undertaking in the co-operation agreement to take all necessary steps to obtain the regulatory clearances.
Deal Structure & Financing
Consideration is £7.15 per share in cash. Alongside it sits a stub equity alternative: eligible shareholders may exchange their easyJet shares one for one for unlisted shares in the new parent company rather than take cash. The board recommended the cash offer unanimously but made no recommendation on the rollover. Evercore, easyJet’s independent adviser, was unable to opine on whether the alternative is fair and reasonable, citing limited liquidity, ownership restrictions and the absence of validated financial projections for the private parent.
The Haji-Ioannou family has given an irrevocable undertaking over approximately 15.31% of the issued share capital, equivalent to 116,061,871 shares, and has elected the rollover rather than cash. easyJet directors have separately committed their combined holdings of 427,767 shares, around 0.06%.
On financing, the cash consideration is funded by committed equity from the Apollo Funds alongside committed long-term debt. Barclays led the debt package, with commitments also from Crédit Agricole Corporate and Investment Bank, Citibank, Citicorp North America, Standard Chartered Bank and Lloyds Bank. Barclays confirmed that sufficient resources are available to satisfy the cash consideration.
Valuation Discussion
The headline premium depends entirely on which unaffected date is used. Against the 394 pence close on 28 May, the last business day before Castlelake’s interest was public, the premium is 81%. Against the close on 27 February, the last business day before the Middle East conflict began, it is 54%. The second is the more honest number for judging what Apollo is paying, because the 28 May price was itself depressed by a fuel shock the market had already priced in.
On multiples, the picture is more striking than the premium suggests. At £7.15 per share, the equity value of roughly £5.7 billion less £434 million of net cash gives an implied enterprise value of about £5.3 billion. Against FY2025 EBITDA of £1.44bn that is ~3.6x. For a business with an investment grade balance sheet, a net cash position and a stated medium-term target of more than £1 billion of profit before tax, those are trough multiples.
What could go wrong
The largest risk is not price, it is ownership law. EU rules require that airlines operating within the bloc be majority owned and effectively controlled by EU nationals in order to retain their operating licences and traffic rights. easyJet operates an Austrian air operator certificate through easyJet Europe, and Apollo is a US firm. Castlelake’s proposed answer was a structure in which EU investors would hold 51% of the acquisition vehicle, an arrangement easyJet’s board described as opaque. Apollo has said it will take all necessary steps to obtain the required clearances but has not publicly disclosed its ownership architecture. Reuters reported in July 2026 that the European Commission is separately reviewing airline ownership rules, with the aim of ensuring foreign investors do not obtain full control, and that review could arrive as early as autumn 2026. A change in the rules mid-process, or a regulator that declines to bless a trust-based structure, are the scenarios that would break the deal.
Leverage into a cyclical business is the second risk, and it is the one the market has focused on. easyJet enters this transaction with net cash of £434 million and £4.7 billion of liquidity, a balance sheet built over several years to absorb shocks. Replacing part of that with acquisition debt removes the cushion at the point when fuel prices are elevated and forward visibility is poor. The airline lost £552 million in the winter half of FY2026 before any deal-related interest, losses that a net cash balance sheet can absorb become considerably less comfortable against a leveraged one.
Third is the order book. easyJet has around 90 aircraft scheduled for delivery over three years, with 17 remaining in FY2026, 30 in FY2027 and 43 in FY2028, and approximately 290 A320neo family aircraft on order to FY2034. A sponsor under pressure to service debt has an obvious incentive to defer or sale-and-leaseback those deliveries, which would preserve near-term cash at the cost of the efficiency programme that justifies the price.
Finally, for shareholders specifically, the stub equity alternative deserves scrutiny rather than enthusiasm. It offers continued exposure to the upside, but in an unlisted vehicle with restricted transferability, an ownership cap and no independent adviser willing to opine on whether the terms are fair.
The gap between easyJet’s traded price and the 715 pence offer since the announcement is the market’s own read on all of this, and it is not a narrow one.
Timeline
28 May 2026: shares close at 394 pence, the last business day before the offer period
29 May 2026: Castlelake discloses it is considering a possible offer; the board calls the approach highly opportunistic
12 to 24 June 2026: Castlelake proposals at 560p, 600p, 625p and 650p, all rejected
25 June 2026: easyJet opens limited commercial due diligence to Castlelake
4 July 2026: Castlelake’s fifth proposal at 690p
5 July 2026: board announces it is minded to recommend the Castlelake proposal
8 July 2026: Apollo submits a proposal at 715p
Late July 2026: the Takeover Panel aligns both put-up-or-shut-up deadlines
6 August 2026: Castlelake confirms it will not bid; Apollo announces a firm offer under Rule 2.7 with unanimous board recommendation
Overall Assessment
After thirty-one years on the public market, easyJet is leaving it. One of the companies that made flying cheap in Europe will spend the next phase of its life owned by a US private equity firm, and the price agreed says as much about when the bid arrived as about what the business is worth.
Whether the price is high or low depends on where you stand in the cycle. An 81% premium sounds high, however, roughly 3.7 times trailing EBITDA for a net cash airline with scarce slots at primary airports and a fast-growing holidays business does not. Both are true, which is what happens when a cyclical asset changes hands at the bottom of a cycle. The deal is a bet that the fuel-driven earnings compression of FY2026 is temporary and that the £1 billion profit target remains reachable.
The real uncertainty is not commercial, it is whether a US sponsor can hold a European airline in a way that satisfies EU ownership and control rules, a question the Commission is reviewing while the deal is still open. Alongside it sits the more familiar concern about what leverage does to a business that spent five years deliberately building a balance sheet to absorb shocks.
Sources
Apollo Management Holdings, L.P. (2026, August 6). Recommended cash acquisition of easyJet plc by Eagle Bidco Ltd(RNS No. 6487P) [Regulatory announcement]. London Stock Exchange. https://corporate.easyjet.com/investors/
Companies Act 2006, c. 46 (UK). https://www.legislation.gov.uk/ukpga/2006/46
easyJet plc. (2025a). Annual report and accounts 2025. https://corporate.easyjet.com/investors/
easyJet plc. (2025b). FY2025 results presentation. https://corporate.easyjet.com/investors/
easyJet plc. (2026). Half year report 2026: Results for the six months ended 31 March 2026. https://corporate.easyjet.com/investors/
FactSet Research Systems. (2026, July 10). Apollo announces £7.15 per easyJet share in cash offer, valuing easyJet at ~£5.7B [StreetAccount news summary].
Munro, R. (2026, August 7). The easyJet private equity takeover: The full deal details. Aviation Business News. https://www.aviationbusinessnews.com/industry-news/the-easyjet-private-equity-takeover-full-deal-details
Panel on Takeovers and Mergers. (2026). The City Code on Takeovers and Mergers. https://www.thetakeoverpanel.org.uk
Plucinska, J., Payne, J., & Parodi, A. (2026, July 22). Exclusive: EU airline ownership review set to harden controls in blow to easyJet bids. Reuters.
Regulation (EC) No 1008/2008 of the European Parliament and of the Council of 24 September 2008 on common rules for the operation of air services in the Community, 2008 O.J. (L 293) 3.