EasyJet pops 13% as airline weighs $7.7 billion rival takeover bid from Apollo

EasyJet stock soared Friday after the budget carrier said it is considering a $7.7 billion takeover bid from Apollo Global Management, putting the airline at the center of a private equity bidding war.

Under the terms of the cash offer, easyJet shareholders would be entitled to £7.15 ($9.61) per share of the company, valuing the firm at £5.7 billion, around $7.66 billion.

As an alternative to the cash payment, Apollo would also offer shareholders a Stub Equity Alternative – the option to “roll their existing shareholding in easyJet into the vehicle through which the Apollo Funds would hold their investment in easyJet.”

The terms of that alternative, which would see shareholders maintain their voting rights, is still subject to further discussion.

The London-listed stock was last trading 13.2% higher. It closed at £5.88 on Thursday, after falling by 0.5% during the trading session. Since the beginning of the year, the shares have risen by 15.2%.

EasyJet’s shares jumped on Monday after the airline agreed in principle to a $7.3 billion takeover offer from private equity firm Castlelake. But the company hinted Friday that it was reconsidering the position.

“The Proposed Cash Offer delivers a superior outcome for easyJet shareholders by providing a higher cash value than Castlelake’s latest proposal,” EasyJet said of Apollo’s bid, noting that the board also saw the proposal as “an attractive combination of value, strategic alignment and long-term stewardship of the business.”

“Accordingly, the easyJet Board is no longer minded to recommend the Castlelake Proposal,” EasyJet said.

Castlelake’s bid represents a cash offer of $6.90 per share, with the firm having until Aug. 3 to make a firm offer or walk away from the deal.

The Apollo bid marks around a 22% premium to Thursday’s closing price.

Apollo’s proposed offer price also represents an 81% premium to easyJet’s closing share price of £3.94 per share on May 28, which was the final business day before the offer period began on Castlelake’s bid to take over the company.

It comes as the global aviation sector remains under pressure, with jet fuel supplies squeezed in the wake of the U.S.-Iran war. Last month, the International Air Transport Association warned global airline profitability was expected to halve this year as the industry’s fuel bills surge.

In the first half of 2026, EasyJet’s losses widened as it reported a pre-tax loss of £552 million – down from a loss of £394 million for the same period the previous year. It said its performance in the second half of the year so far had been impacted by the Middle East conflict, with higher fuel costs and lower forward visibility weighing on operations.

An acquisition by Apollo increases the probability of EasyJet’s growth path continuing as planned, Bernstein analysts said in a note on Friday morning.

“However, in this case, a heroic cost restructuring and earnings inflection, far above what we currently forecast, would be required for the deal to make sense at this price,” they added.

— CNBC’s Hugh Leask contributed to this article.