British low-cost carrier easyJet has rejected the latest takeover proposal from US investment firm Castlelake, but the potential acquisition process is not over. The airline’s board said the offer of £6.50 per share, valuing the company at around £4.9 billion, still significantly undervalues easyJet.

However, easyJet has given Castlelake an additional nine days to submit an improved proposal. The new deadline expires at 17:00 BST on July 5, 2026, under the UK takeover regime known as the “put up or shut up” rule, which requires a potential bidder either to make a firm offer or walk away.

During this extended period, Castlelake and its advisers will receive limited access to additional commercial, financial and operational information from easyJet. Although the board has rejected the current proposal, this move leaves room for further talks and a possible revised valuation of the airline.

Castlelake has welcomed easyJet’s decision, and the US investment firm is expected to consider increasing its offer in an attempt to secure the board’s support. Previous proposals, reportedly including offers of £5.60, £6.00 and £6.25 per share, had also been rejected by easyJet.

In its public statement, easyJet emphasized that the company remains profitable, has a strong balance sheet and a net cash position, and is on track to deliver profit before tax above the £1 billion mark. The board therefore believes that the current offer does not reflect either the airline’s current performance or its future potential.

At the same time, easyJet warned that a prolonged takeover process could have a negative impact on the company’s operations and financial position. For that reason, the board requested only a limited extension of the deadline, aiming to avoid a long period of uncertainty for the airline, its employees, passengers and shareholders.

Any possible takeover of easyJet also has a regulatory dimension. As airlines operating within the European Union must remain majority owned and controlled by EU nationals, Castlelake has included European partners and aviation executives in the proposed transaction structure. This is intended to address ownership and control requirements, although regulatory approval would remain a key issue in any final deal.

Although the latest offer has been formally rejected, easyJet’s decision to open part of its data room to Castlelake suggests that a deal is not yet off the table. The final outcome will likely depend on whether Castlelake is prepared to raise its offer to a level the easyJet board considers acceptable.