Budget airline easyJet could become the target of a cut-price takeover bid after a turbulent year that has seen its share price slump and fuel costs surge. The Luton-based carrier is facing growing pressure as geopolitical tensions continue to drive up the cost of aviation fuel, prompting it to raise some ticket prices and warn of a major financial hit.
US investment firm Castlelake confirmed on Friday (May 29) that it is considering a possible offer for easyJet, although no formal approach has yet been made to the airline’s board, it stressed. Under takeover rules, the firm – which manages $36billion (£27billion) in assets – has until 5pm on June 26 to decide whether to proceed with a bid. The development comes at a difficult time for easyJet, whose market value has fallen sharply after a prolonged decline in its share price.
Shares have crashed 22.9% since January, and are down 53% over the past five years, leaving the company valued at only £3billion – the smallest of Europe’s five biggest airlines. The airline also recently reported a half-year pre-tax loss of £552million, up from the previous year’s £401million, and warned that higher fuel prices could add around £175million to its costs over the summer months.
Iran’s closure of the Strait of Hormuz – a vital shipping lane – has sent jet fuel prices rocketing more than 80% since late February, disrupting roughly 20% of the world’s entire oil supply.
Chief executive Kenton Jarvis said the airline continues to see strong travel demand but acknowledged that higher operating costs are creating significant challenges across the industry.
The closure of key shipping routes in the Middle East has pushed up fuel prices dramatically, placing pressure on airlines across Europe and raising concerns that passengers could face higher fares in the months ahead. To claw back some of its costs, easyJet has raised the minimum price of its winter 2026/27 flights by “two to three pounds,” though Mr Jarvis insisted fares this summer remain “incredibly attractive”. It has also hedged – or fixed in advance – more than 70% of its fuel needs until September.
Meanwhile, the airline said its summer bookings are running below last year’s levels as worried households hold off on buying flights.
Any potential takeover would likely attract close scrutiny from investors, including easyJet founder Sir Stelios Haji-Ioannou and his family, who remain among the airline’s largest shareholders. Having launched the airline in 1995, he quit the board in 2010 after a row over the company’s future direction. However, his family still holds a 15% stake, making them the largest single shareholder group.
The Express has contacted easyJet for comment.