Castlelake goes public with £4.74bn easyJet bid after board rejects third offer, presses shareholders ahead of June 26 deadline

The public push

Castlelake on Monday disclosed the terms of its third non-binding proposal for easyJet, valuing the British low-cost carrier at £4.74 billion in cash. The Minneapolis-based firm, which manages roughly $38 billion in assets and has deployed more than $24 billion in aviation since 2005, said it was going public "following the rejection of three proposals" and the board's "unwillingness to engage meaningfully." The move shifts pressure onto shareholders ahead of a 26 June deadline under UK takeover rules for Castlelake to make a formal offer or walk away.

Escalating offers

Castlelake's three offers climbed from £5.60 per share (12 June) to £6.00 (17 June) and finally £6.25. The latest bid carries a premium of about 57 percent to easyJet's closing price of £3.94 on 29 May, the last session before interest became public. Castlelake also said it will offer a partial equity alternative so shareholders can remain invested in the carrier as a private business, subject to a participation cap.

EasyJet's defence

The board dismissed the third approach as "highly opportunistic" and said it failed to reflect the airline's medium-term prospects, strong balance sheet, and capital structure. EasyJet points to a pretax profit that grew 46 percent over the past two years and a medium-term target of more than £1 billion in annual pretax profit. The company carried 93 million passengers in the financial year ending 30 September 2025, generating revenue just above £10 billion with a pretax profit of £665 million. It posted a £552 million pretax loss in the first half to 31 March 2026 on revenue of £3.95 billion, carrying 42 million passengers, weighed down by fuel-cost shocks from the Iran war.

The proposals do not reflect easyJet's medium-term prospects, strong balance sheet or capital structure. They are highly opportunistic and fundamentally undervalue the company against a temporarily depressed share price.

The shareholder question

Attention now falls on the shareholder register, where Stelios Haji-Ioannou, the airline's founder, and his family control 15.3 percent through the EasyGroup foundation. He has said nothing publicly on either side. Investment funds hold approximately 70 percent of the equity. EasyJet shares closed up 2.78 percent at 518 pence on Monday, having touched an intraday gain of 5.3 percent. Since 29 May the stock has risen about 27 percent, though it remains well below the 625p offer price, a gap the market reads as scepticism that a shareholder rebellion will materialise.

Ownership structure and EU rules

To comply with European airline ownership rules requiring majority control by EU nationals, Castlelake has partnered with Peter Bellew, former Malaysia Airlines CEO and ex-Ryanair and easyJet manager, and Mark Breen, former head of Dominican carrier Arajet. The bid vehicle would be 51 percent owned by EU nationals and other investors, with Castlelake holding 49 percent, according to reports. Castlelake stated Goldman Sachs has confirmed its ability to arrange the required debt financing. EasyJet's board, however, cited "significant reservations" about the high leverage and described the planned ownership structure as "opaque."