EasyJet's shares reacted strongly on Monday after the British low-cost carrier confirmed it would consider a formal offer from U.S. investment firm Castlelake, which had disclosed it was in the early stages of exploring a potential bid.
By 08:37 GMT, the stock had climbed about 9% in London trading.
On Friday Castlelake, holder of a 2.14% stake in easyJet, said it was weighing a possible approach but had not yet contacted the airline's board. Under the United Kingdom's takeover rules, the firm has until June 26 to either make a firm offer or withdraw from the process.
In its announcement, Castlelake specified that any proposal would place a floor on easyJet's valuation at £3.06 billion, equating to no less than 403.23 pence per share. That figure represents a 1.3% premium to easyJet's closing price of 398 pence on Friday.
EasyJet replied that its board would evaluate any offer if one were formally submitted. In its statement the airline noted its share price has recently been temporarily weighed down by the conflict in the Middle East as well as regulatory and other pressures.
"The Board remains highly confident in easyJet's strategy and its ability to deliver attractive long-term value for shareholders," the company said, and characterised Castlelake's timing as "highly opportunistic."
The airline also cautioned that any acquisition would face significant obstacles. It highlighted regulatory, funding and execution complexities that would need to be resolved before a transaction could proceed, and advised shareholders to take no action at this stage.
Market and procedural context
The statement from Castlelake establishes a clear minimum valuation and triggers the timetable set out in takeover regulations, while easyJet's response leaves open the possibility of a review should a formal proposal arrive. Both the investor and the airline framed the development as early-stage: Castlelake said it had not approached the board, and easyJet emphasised the hurdles any deal would entail.
Investors reacted quickly, sending the share price higher in intraday London trading.
What shareholders were told
- Castlelake values easyJet at a minimum of £3.06 billion, or no less than 403.23 pence per share.
- Under U.K. takeover rules, Castlelake has until June 26 to make a firm bid or walk away.
- EasyJet warned of regulatory, funding and execution challenges and asked shareholders to take no action for now.