EasyJet’s board has unanimously rejected a third unsolicited indicative offer from US investment fund Castlelake, pitched at 625 pence per share and valuing the Luton-based carrier at £4.74 billion (€5.47 billion, $6.25 billion). The proposal, disclosed by Castlelake on Monday, represents a 59% premium to the undisturbed share price of 394.2 pence on 28 May, the day before initial interest became public. The board’s swift dismissal on 21 June — the third rejection in ten days — prompted Castlelake to bypass management and appeal directly to shareholders, arguing the airline has refused to “engage meaningfully.”

The stand-off unfolds against a sector-wide compression of airline equity. EasyJet’s shares had already fallen roughly 30% over the preceding year, a decline the company attributes to the Iran war’s effect on fuel costs and consumer confidence. Viewed from London, the board’s language — branding the approach “highly opportunistic” and “low cost” — signals a conviction that the bid exploits a transient geopolitical shock rather than a structural undervaluation. Castlelake counters that its offer compares favourably even if EasyJet hits its medium-term target of more than £1 billion in pre-tax profit. The fund, which holds a 2.14% stake via managed vehicles, has previously restructured Scandinavian Airlines and entered talks with bankrupt US carrier Spirit Airlines.

European ownership rules add a layer of complexity. EasyJet, though UK-headquartered, operates as a pan-European airline and must remain more than 50% owned and effectively controlled by EU nationals. Castlelake’s proposed structure would place 51% of the equity with unnamed European nationals and 49% with the fund itself. The board has criticised this arrangement as lacking transparency and raising “significant doubts” about high leverage. In Paris, Air France-KLM has stated it is not involved in the discussions, though its chief executive indicated he would monitor developments. Analysts in Madrid note that IAG has already ruled out a counterbid, citing insurmountable European competition hurdles.

The public escalation comes just days before the UK Takeover Panel’s “put-up-or-shut-up” deadline of 5 p.m. on 26 June, by which Castlelake must declare a firm intention to make an offer or walk away. The fund has left open the possibility of a partial equity alternative allowing shareholders to remain invested in a private vehicle alongside Castlelake, but stressed there is no certainty a formal bid will materialise. The next milestone is therefore the deadline itself, which will either force a binding offer onto the table or close the episode.