A bidding war has broken out for one of Europe's biggest airlines, with two US private equity firms trying to buy EasyJet. On 10 July 2026, EasyJet's board said it was "minded to recommend" a £5.7bn all-cash offer from Apollo Global Management, worth £7.15 per share. That trumped a previous offer of £6.90 per share from Castlelake, which the board had agreed to in principle just days earlier. But what does a private equity takeover actually mean for the airline, its staff and its passengers?
Private equity firms are investment companies that pool money from large investors—such as pension funds and wealthy individuals—to buy companies. They often take the target company private, meaning its shares are no longer traded on the stock market. The goal is typically to improve the company's performance over several years and then sell it at a profit. In the case of EasyJet, both Apollo and Castlelake are US-based private equity firms. Apollo has signalled that it would back EasyJet's existing strategy and management, and does not intend to break up the company. Castlelake has not commented on its plans beyond noting EasyJet's statement and "considering its options".
“Explains private equity takeovers using the EasyJet bidding war as a case study.”
EasyJet was founded in 1995 by Sir Stelios Haji-Ioannou to offer low-cost flights across Europe. It now employs more than 19,000 people, flies around 1,200 routes across 35 European countries, and is one of the region's largest airlines. Sir Stelios and his family still own about 15% of the company. Under EU rules, European airlines must be majority-owned by investors within the region, which could affect any deal if the new owner is US-based. But analysts say EasyJet is an attractive target because it is profitable, has a large fleet of aircraft, and owns valuable take-off and landing slots at airports like Gatwick and Paris Charles de Gaulle.
For UK passengers, the immediate impact is minimal. As Susannah Streeter, chief investment strategist at Wealth Club, put it: "For passengers, it's very much business as usual for now, with flights, bookings and loyalty schemes unaffected while any deal works its way through the regulatory process." However, the longer-term effect on fares is uncertain. Conroy Gaynor, senior consumer analyst at Bloomberg Intelligence, noted that while Apollo has "more explicitly" backed EasyJet's growth model, "the need to improve the airline margin suggests any success in lowering costs won't necessarily translate to lower fares." Package holidays—a growing part of EasyJet's business—generate higher margins and more predictable revenues, which may be a focus for the new owners.
Q: Why do private equity firms want to buy airlines? Airlines like EasyJet have valuable assets: aircraft, airport slots, and established customer bases. Private equity firms see potential to improve profitability by cutting costs, expanding higher-margin businesses like holidays, and selling the company later at a higher price. Apollo has specifically highlighted EasyJet's "fast-growing holidays business" as a key attraction.
Q: What happens to EasyJet's founder, Sir Stelios Haji-Ioannou, if the takeover goes through? Sir Stelios and his family own about 15% of EasyJet. Under Apollo's offer, they could choose to sell their stake for around £855m, or remain invested if Apollo allows it. Apollo also intends to keep in place an existing brand licence agreement under which Sir Stelios receives royalties from the airline.
Q: Will EasyJet remain a British airline after a takeover? EasyJet is a UK-headquartered airline, but if a US firm takes full ownership, EU ownership rules could become an issue. Under EU law, European airlines must be majority-owned and controlled by EU nationals. However, since the UK left the EU, the rules for UK airlines operating in Europe are still being defined. For now, the UK's own rules require airlines to be majority-owned by UK or EEA nationals to hold a UK operating licence. The deal structure may involve retaining some UK ownership to comply.
What happens next? The takeover is not yet final. Apollo has been set a deadline of 17:00 on 7 August 2026 to make a firm offer or walk away. Castlelake's deadline is 3 August. The EasyJet board has switched its recommendation from Castlelake to Apollo, but Castlelake may increase its offer again. Any deal will also need regulatory approval, which could take months. Until then, flights and bookings continue as normal.