London, July 5, 2026, 22:05 (BST)
- easyJet’s board is leaning toward supporting Castlelake’s 690p per share cash bid, as long as it comes through as a formal offer.
- Shares closed at 558.20p on Friday, putting the stock 23.6% below the deal price, or a 19.1% discount to the offer.
- Castlelake has to decide by Aug. 3 whether to make a firm bid or pull out. EU ownership rules are still a risk to the deal.
easyJet (LON:EZJ) said Sunday it has reached an agreement in principle with Castlelake on a sweetened 690 pence per share cash bid. The potential deal, which comes after a month of turning down earlier offers, could see the UK budget airline go private. The proposal puts easyJet’s value at as much as 5.5 billion pounds ($7.34 billion) on a fully diluted basis, Reuters reported.
The main number that matters to investors right now is the spread. easyJet (EZJ:LON) closed at 558.20p on Friday, giving the airline a market cap of £4.23 billion, Google Finance data showed. London’s market stays closed over the weekend. The exchange is open Monday to Friday, 8:00 to 16:30.
| Deal measure | Value | Investor read |
|---|---|---|
| Castlelake proposal | 690.0p/share | That’s the cash offer |
| Friday close | 558.2p/share | Stock finished here before deal leaked Sunday |
| Gross upside to proposal | 23.6% | Pre-fee, pre-risk spread for arb funds |
| Discount to offer price | 19.1% | Shares trade under the deal price |
| Fully diluted equity value at 690p | About £5.5 bln | Reuters put the offer figure here |
| Value gap vs Friday close, fully diluted | About £1.05 bln | Estimate of equity gap in the deal spread |
The offer is 11.1% over easyJet’s 52-week high of 621p, but it’s still 10p under the 700p that some holders wanted. Reuters reported last week that easyJet shares have not hit 700p or more since early 2022.
Castlelake has lifted its offer five times now. With the 799.3 million fully diluted share count from its June 22 basis, every extra 10p a share adds around 80 million pounds. The latest proposal is roughly 520 million pounds above the 625p per share bid disclosed June 22 and about 320 million more than the 650p offer that easyJet turned down on June 25.
| Date | Proposal | Status | Change vs prior bid | Rough fully diluted value added |
|---|---|---|---|---|
| June 12 | 560p/share | Rejected | — | — |
| June 17 | 600p/share | Rejected | +40p | About £320 mln |
| June 20 | 625p/share | Rejected | +25p | About £200 mln |
| June 23 | 650p/share | Rejected June 25 | +25p | About £200 mln |
| July 4/5 | 690p/share | Board said it plans to recommend | +40p | About £320 mln |
The spread is there for a reason. Castlelake has a deadline of 5 p.m. London time on Aug. 3 to make a binding offer or pull out, according to the parties’ statement cited by Travel Weekly. Any deal would still have to get shareholder signoff and pass regulators.
Shares were sliding ahead of the weekend deadline. Barclays analyst Andrew Lobbenberg told Reuters on Friday the recent move could be due to broker downgrades and some investors taking profits in case there was no deal. He said the drop showed a “modest reduction” in chances of a deal. Reuters
Goodbody Stockbrokers analyst Dudley Shanley said the change was obvious after data access was granted. “The narrative has definitively changed,” he told Reuters on June 25. Shanley said easyJet was “in negotiations with Castlelake” and open to a sale “at the right price.” Reuters
The trickier issue is control. Back in June, easyJet said Castlelake’s original setup would give Castlelake and co-investors 49% and EU nationals Peter Bellew and Mark Breen 51%. That lineup aimed to meet European airline ownership rules. Still, easyJet also raised questions about who would really own the company, how deliverable the deal would be, and whether management could handle it.
Samuel Ziff, portfolio manager at Oldfield Partners and easyJet investor, told Reuters the carrier owns a “very valuable fleet” and “very valuable slots.” He said easyJet’s management has a clear profit target for 2030. easyJet lists 355 aircraft, 1,207 routes, service to 164 airports and work in 38 countries. Castlelake says it has put more than $24 billion into aviation since 2005, working with over 200 airlines. Reuters
The bid also amounts to a call on time. easyJet’s medium-term targets set out more than £1 billion group profit before tax and £450 million profit before tax from easyJet holidays by 2030. The cash offer would take investors out before that plan is finished.
Stelios Haji-Ioannou and his family have over 15% of easyJet, the Guardian said, and their view could be key if investors vote. The board faces an Aug. 3 deadline for Castlelake to make a formal bid or walk away under UK rules.
