easyJet shareholders approved a £5.7 billion ($7.61 billion) takeover bid from private equity firm Apollo on Wednesday, marking a decisive step in one of the largest leveraged buyouts of a European airline and paving the way for its delisting from the London Stock Exchange.
Broad Shareholder Backing for Delisting
The vote held during the general meeting yielded overwhelming support for the transaction, which is structured as a court-sanctioned scheme of arrangement.
- Scheme shares: 97.07% of the votes cast backed the proposal.
- Voting shareholders: 83.29% voted in favor of the deal.
With this outcome, the low-cost carrier cleared the threshold required to finalize the transaction and go private. The company aims to complete the acquisition before the end of the first quarter of next year, marking the delisting of its shares from the London market after more than a quarter of a century of public trading.
This transaction represents the latest move in a string of acquisitions of London-listed companies by predominantly U.S.-based private equity firms, driven by the trading discount of the Financial Times Stock Exchange 100 (FTSE 100) index compared to its U.S. peers.
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European Union Ownership and Control Regulatory Hurdles
Despite shareholder approval, the buyout faces complex regulatory challenges before the European Union (EU), where authorities are preparing a review of airline ownership rules to prevent foreign investors from acquiring effective control of carriers within the bloc.
easyJet’s operational structure faces the following legal considerations:
- Headquarters and Air Operator Certificates (AOCs): Although it maintains its corporate headquarters in Great Britain, the airline relies on EU operating licenses to maintain bases and operate routes across member states.
- EU ownership requirement: EU regulations mandate that a majority of the share capital be owned and effectively controlled by EU nationals.
- Suspension of voting rights: To comply with regulatory mandates, the carrier had to suspend the voting rights of certain shares held by non-EU investors.
- EU shareholding: At the time of Wednesday’s general meeting, the level of share ownership by EU nationals stood at 35.07%.
Opposition from Labor Organizations
The takeover process is also encountering resistance on the labor front. The European Works Council warned that the financial structure of the transaction could weaken the airline’s operational and financial resilience, while exposing employees to risks that have not yet been adequately addressed by the parties involved.
The final completion of the buyout will now depend on scrutiny from European regulators regarding foreign control criteria, as easyJet and Apollo look to meet contractual deadlines toward the first quarter of next year.
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