easyJet backs rival GBP5.7 billion deal as Apollo tops Castlelake bid
(Alliance News) - easyJet PLC on Friday said it has agreed in principle to a GBP5.7 billion takeover proposal from asset manager Apollo Management X LP that beats one it had agreed to from a rival US private equity firm.
The cash bid from Delaware-based Apollo is worth 715 pence per easyJet share and trumps a plan from Minneapolis-based private equity firm Castlelake LP worth 690p per share.
easyJet said it was now "no longer minded" to accept Castlelake's offer and called Apollo's proposal a "superior outcome" for shareholders.
In response, shares in the Luton, Bedfordshire-based budget airline soared 14% to 667.80 pence each in London on Friday, a four-year high, giving easyJet a GBP5.13 billion market capitalisation.
As an alternative to receiving cash, Apollo is proposing to offer easyJet shareholders the opportunity to roll their shareholding into the vehicle through which the Apollo funds would hold their investment in the airline.
Apollo has confirmed that it would take "all necessary steps" to satisfy any conditions relating to merger control and EU Foreign Subsidies Regulation clearances. It will also keep the easyJet brand.
Apollo has until August 7 to announce a firm offer or walk away.
Castlelake's offer of 690p per share was its fifth tilt to win over FTSE 250-listed easyJet. It made a first cash bid for the airline of 560 pence per share on June 12.
By Jeremy Cutler, Alliance News reporter
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