The airline that taught Europe to fly for the price of a train ticket is going private. EasyJet’s board has accepted a firm £5.7bn cash offer from Apollo Global Management at £7.15 a share, announced on 6 August, a day before the deadline the UK Takeover Panel had set for both bidders to put up or walk. Castlelake, which had circled the airline since spring and at one point had the board’s backing at £6.90, walked. It made five approaches over several months and never once converted them into a firm offer.
The shares rose about 3 per cent on the news, to 672p. That is still short of the offer price, which is the market’s usual way of saying it expects this to take a while.
Apollo is buying a war discount
The premium looks enormous. £7.15 is 81 per cent above the £3.94 close on 28 May, the last trading day before the offer period opened, and 22 per cent above the highest price the shares reached in the four years before that.
But the premium is only that large because the base was that low. European short-haul equities were hit hard after the Iran conflict began in February, and EasyJet took it worse than almost anyone: fuel exposure, a network weighted heavily toward leisure, and a customer base that cancels first when the news gets loud. Apollo is not paying up for an airline at its peak. It is paying up for one that got cheap in a hurry, and it is buying the slot portfolio at Gatwick and the packages business underneath the share price.
Why the deal needed a Jersey company and an EU trust
The ownership structure is the most interesting part of the whole thing. An American private equity firm cannot simply own a European airline. EU rules require carriers to be majority owned and effectively controlled by EU nationals, and a large share of EasyJet’s continental flying sits on an Austrian certificate held by easyJet Europe. Post-Brexit, that constraint is real rather than technical.
So the buyout has been engineered around it. The shares are acquired by Eagle Bidco, a Jersey company indirectly owned by Apollo funds, through a court-approved scheme of arrangement. Sitting above it is a holding company whose share register is capped to the decimal point. Apollo funds take no more than 49.9 per cent. Shareholders who elect to roll over rather than take cash hold somewhere between 45.1 and 49.9 per cent, scaled back pro rata if too many of them elect. An EU trust holds up to 5 per cent under a management incentive plan.
Which makes Sir Stelios structurally load-bearing. The Haji-Ioannou family holds just over 15 per cent and has irrevocably committed to vote the scheme through and roll its entire stake rather than cash out, a commitment that stands even if a higher offer turns up. The founder who spent more than a decade publicly needling a board he no longer controlled is now the reason the deal is compliant, and the reason nobody else can gatecrash it.
What actually changes for passengers
For now, nothing. Apollo has committed to keeping both the UK and EU headquarters and says it intends to support the existing strategy rather than rewrite the network or the fleet plan. Every buyer says this.
What is worth watching is slower and quieter. Financial ownership tends to show up first in ancillary revenue, because that is the fastest lever an airline has: bag pricing, seat selection, the boarding upsell, the bundling of things that used to be separate. It shows up second in easyJet holidays, the packages arm that has been the growth story for several years and is exactly the kind of high-margin attachment a new owner leans on. And it shows up third in route patience. Private owners are less willing to carry a thin route through three weak seasons to build a market, which usually means the marginal bases and the marginal frequencies go before anything a frequent flyer would recognise as a cut.
None of it happens this year. Shareholder votes, regulatory clearances and a court sanction all come first, and a scheme of arrangement on this scale rarely closes in under six months.
The orange planes will look the same for a long time before anything about them does.