Boardroom tensions at Easyjet as US predator Castlelake besieges budget airline

Easyjet is facing boardroom tensions over its future after it received a multi-billion pound takeover approach from a US suitor.

Chairman Stephen Hester is understood to be more keen on a deal with buyout firm Castlelake than others on the board, who remain sceptical.

Castlelake this week saw a £4.9bn offer rejected by the airline but was invited to come up with a more attractive bid.

The offer valued Easyjet at 650p a share, but there are suggestions that some on the board want to hold out for £10 a share, the Daily Mail understands.

Castlelake has been upping the ante in its pursuit of the low-cost carrier. The latest offer – its fourth – was judged by the airline’s board to have ‘substantially’ undervalued the company. 

But Easyjet has granted Castlelake access to ‘limited commercial information’ which ‘might produce a more attractive proposal that better reflects the value of the business’. It has also extended the deadline for Castlelake to make a firm offer or walk away until July 5.

The Daily Mail revealed this week that easyJet founder Stelios Haji-Ioannou, who still has a 15pc stake, was holding out for an ‘eye-watering’ bid to persuade him to sell.

Castlelake has proposed making the purchase through a new group in which it holds a 49pc stake, with the other 51pc held by EU citizens. 

Under European Union rules, the airline must be majority-owned by EU citizens because of its major operations within the bloc.

It is not the first time that Hester has been involved with a UK-listed firm facing a foreign takeover approach. In 2020, he was chief executive of RSA when the 300-year-old insurer – owner of the More Than insurance brand – agreed to a £7.2bn deal that saw it split up and parcelled off to Canada’s Intact and Denmark’s Tryg.

Hester was boss of Royal Bank of Scotland and was tasked with stabilising the lender after its £45bn government bail-out in 2008.

EasyJet declined to comment. A source close to the group said: ‘There is no split on the board.’

Castlelake’s approach is the latest in a wave of takeovers of UK firms by foreign bidders as the London stock market becomes a ‘hunting ground’ for overseas predators.

Earlier this week, warehouse giant Segro knocked back a £12.6bn offer. City institution Schroders, Lloyd’s of London insurer Beazley and laboratory testing group Intertek have also backed foreign takeover bids this year, while energy firm DCC is set to follow suit.