EasyJet has agreed to be taken private in a £5.7 billion deal with US private equity firm Apollo Capital Management, ending months of speculation about the budget airline’s future. The agreement was officially announced after Castlelake, another US investment firm that had been engaged in a bidding war, confirmed it would not submit a rival offer to counter Apollo’s proposal.

Apollo’s £5.7 billion bid values EasyJet at 715p per share, representing a premium over Castlelake’s earlier £5.5 billion offer. The deal has received backing from EasyJet’s board, including its founder and largest shareholder, Sir Stelios Haji-Ioannou, whose family owns approximately 15.3% of the airline. Haji-Ioannou, who founded EasyJet in 1995, expressed support for Apollo’s strategic vision and said his family intends to remain invested as long-term shareholders through a rollover of their stake into the private company once the deal completes.

Under the terms of the takeover, Apollo will hold up to 49.9% of the business, while shareholders who roll over their shares into the new private structure will collectively control at least 45.1%. To comply with European Union ownership rules—designed to ensure airlines with EU operating licenses remain majority European-owned—Apollo intends to establish an EU-based trust to hold up to 5% of shares. This regulatory aspect has gained prominence because EasyJet operates an Austrian subsidiary, established after Brexit to maintain access to the European aviation market.

The transaction, expected to conclude by March 2027, must secure regulatory approval and pass a shareholder vote. The deal follows a prolonged period of EasyJet’s share price underwhelming performance, partly influenced by ongoing challenges in the aviation sector, including the pandemic’s lingering effects and recent volatility in jet fuel costs tied to geopolitical tensions.

EasyJet’s chairman, Sir Stephen Hester, stated that the board had thoroughly reviewed Apollo’s offer alongside the airline’s standalone prospects and concluded that the proposal delivered immediate and assured value for shareholders, recognizing the company’s longstanding value. EasyJet chief executive Kenton Jarvis welcomed Apollo’s involvement, highlighting the firm’s experience in aviation and its potential to support EasyJet’s growth plans.

Apollo partners, including European private equity lead Alex van Hoek, described EasyJet as a compelling asset within the global aviation market and expressed pride in their role supporting the airline’s next stage of development, emphasizing its significance to both UK and European aviation sectors.

Despite Castlelake withdrawing from the bidding process, the firm left open the possibility of returning with an improved offer. EasyJet and Apollo have indicated that Haji-Ioannou’s family could also reconsider their support if a rival bid surpasses Apollo’s offer by at least 9%. The deal marks another notable takeover of a London-listed company, contributing to concerns about the shrinkage of the UK stock market. Analysts have noted that EasyJet’s net asset value per share may exceed the current bid price, adding complexity to investor reactions.

Following the announcement, EasyJet shares rose by approximately 2.8% to 670p, reflecting market approval of the takeover. The airline, founded as a low-cost alternative to traditional carriers, has grown into one of Europe’s largest budget networks, with the new ownership expected to help navigate a challenging post-pandemic market environment.