EasyJet agrees $7.7 billion Apollo deal as Castlelake walks away

Apollo Global has agreed to buy European budget airline easyJet in a £5.70 billion deal, ending months of uncertainty and surpassing rival suitor Castlelake's £5.5 billion proposal.

Apollo Global has agreed to buy European ‌budget airline easyJet in a deal that values the carrier at about £5.70 billion ($7.7 billion), the companies said on Thursday, as rival suitor Castlelake abandoned its pursuit. The deal ends months of uncertainty surrounding ‌one of Europe's biggest low-cost airlines as the industry grapples with rising costs from ‌the Iran war.

Castlelake earlier on Thursday withdrew from the takeover race without giving a reason. Castlelake had tabled five bids for easyJet before Apollo entered the fray in July, topping Castlelake's £5.5 billion proposal and securing the backing ⁠of ​the airline's board.

Following the ⁠deal, Apollo anticipates that the family of easyJet founder Stelios Haji-Ioannou and other shareholders remaining invested will hold ⁠between 45.1% and 49.9% of the ordinary capital of the purchasing vehicle. An EU management trust will ​hold up to 5%, Apollo's funds will hold the rest, up to a maximum ⁠of 49.9%.

"Having carefully reviewed the proposal by Apollo, my family members and I have decided to support ⁠the ​recommended acquisition announced by the easyJet board," Haji-Ioannou said in a separate statement. EasyJet shares, which have rallied more than 65% since the initial takeover interest was disclosed, were up ⁠3.6% at 675 pence by 1406 GMT.

The £7.15 per share offer, which easyJet's board unanimously recommended, represents ⁠a premium of ⁠about 81% to easyJet's closing price of £3.94 on May 28, the last trading day before Castlelake's interest became public. ($1 = 0.7424 pounds)