Key Takeaways
- • easyJet shareholders approved the takeover by Apollo Global Management, which values the British low-cost carrier at £5.41 billion ($7.26 billion), with 83% of shareholders by headcount and 97.07% of voted shares in favour at a general meeting held on a Wednesday.
- • Apollo prevailed over rival bidder Castlelake after entering the contest late with a higher offer that easyJet's board welcomed, while Castlelake dropped out.
- • Founder and largest shareholder Sir Stelios Haji-Ioannou backed the Apollo bid, and the Haji-Ioannou family trust remains the largest single shareholder.
- • Apollo plans to keep easyJet operating as a low-cost airline and improve performance through fleet upgauging, enhanced ancillary and loyalty offerings, and scaling its Holidays business.
- • easyJet's financial performance has lagged Ryanair in recent years, and its assets are currently worth more than the value of its shares, according to the report.
Summary
Shareholders of easyJet have decisively approved the airline's takeover by New York-based private equity firm Apollo Global Management, according to PYOK. The proposed deal, which values the carrier at £5.41 billion ($7.26 billion), was announced in July and was one of the final hurdles to completion. At a general meeting held on a Wednesday, 83% of shareholders by headcount voted in favour, and by share volume 97.07% of voted shares supported the deal.
The contest for easyJet began when rival private equity firm Castlelake made an initial approach that the airline's board criticised as undervaluing the company. Castlelake returned with two further bids before Apollo entered the battle. easyJet's board welcomed Apollo's higher offer, and Castlelake withdrew. Sir Stelios Haji-Ioannou, the airline's founder and largest shareholder, immediately supported the Apollo bid and urged other shareholders to do likewise.
Apollo has said it intends to keep easyJet running as a low-cost carrier and to improve its financial performance through "upgauging the fleet, enhancing the ancillary and loyalty offering, and scaling Holidays into a structurally differentiated earnings stream." Founded in 1990, Apollo has a broad portfolio spanning hospitality, leisure, media and telecoms. The firm has aviation experience, including a $745 million senior secured financing of Virgin Atlantic's take-off and landing slots at London Heathrow last November, funding for Air France-KLM Group including its Flying Blue programme, and prior ownership of U.S. ultra-low-cost carrier Sun Country. By contrast, Castlelake has aviation financing experience but has never run an airline.
EasyJet, founded in 1995, has grown into one of Europe's largest low-cost airlines. However, its financial performance has trailed that of main rival Ryanair in recent years. According to the report, its assets, including aircraft, airport gates and take-off and landing slots, are currently worth more than the value of the company's shares.
The contest for easyJet began when rival private equity firm Castlelake made an initial approach that the airline's board criticised as undervaluing the company. Castlelake returned with two further bids before Apollo entered the battle. easyJet's board welcomed Apollo's higher offer, and Castlelake withdrew. Sir Stelios Haji-Ioannou, the airline's founder and largest shareholder, immediately supported the Apollo bid and urged other shareholders to do likewise.
Apollo has said it intends to keep easyJet running as a low-cost carrier and to improve its financial performance through "upgauging the fleet, enhancing the ancillary and loyalty offering, and scaling Holidays into a structurally differentiated earnings stream." Founded in 1990, Apollo has a broad portfolio spanning hospitality, leisure, media and telecoms. The firm has aviation experience, including a $745 million senior secured financing of Virgin Atlantic's take-off and landing slots at London Heathrow last November, funding for Air France-KLM Group including its Flying Blue programme, and prior ownership of U.S. ultra-low-cost carrier Sun Country. By contrast, Castlelake has aviation financing experience but has never run an airline.
EasyJet, founded in 1995, has grown into one of Europe's largest low-cost airlines. However, its financial performance has trailed that of main rival Ryanair in recent years. According to the report, its assets, including aircraft, airport gates and take-off and landing slots, are currently worth more than the value of the company's shares.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.