EasyJet Agrees to $5.7 Billion Takeover Bid from Apollo, Eyes London Exit

EasyJet has accepted a revised takeover bid valued at £5.7 billion from U.S. investment firm Apollo Global Management, signaling a potential exit from the London market. The budget airline's board has urged shareholders to accept the offer, which it states provides a superior financial outcome compared to a previous bid.

This agreement follows an earlier, lower offer of £5.5 billion from another U.S. investor, Castlelake, which EasyJet had initially accepted in principle. Apollo's improved proposal of £7.15 per share represents an 81% premium over EasyJet's closing price before Castlelake's initial bid. Apollo is required to make a firm offer by August 7, or withdraw its bid, while Castlelake has a deadline of August 3.

EasyJet had previously rejected four proposals from Castlelake, with the airline's management describing them as "highly opportunistic" and an attempt to secure the deal at a low price. The potential sale of EasyJet marks another significant transaction involving foreign buyers in the London market, with other prominent companies like Tate & Lyle, Beazley, Schroders, and the owner of William Hill also having been targeted.

Warehouse firm Segro also recently rejected a £12.6 billion bid from U.S. firm Prologis, though it did not rule out a sale at a more favorable price. The acquisition of EasyJet is likely to require the approval of its founder, Sir Stelios Haji-Ioannou, and his family, who collectively hold a 15.3% stake in the company. Sources have indicated that a substantial offer would be necessary to persuade the family to sell their shares.