EasyJet’s board has agreed in principle to a £5.2 billion Castlelake takeover, accepting £6.90 per share in cash from the US investment firm. The agreement, reported on Sunday by Bloomberg and confirmed by the BBC, values the budget carrier at £5.5 billion on a fully diluted basis. It follows four rejected offers the airline once called highly opportunistic.

The timing tells its own story. EasyJet has been under pressure from soaring jet fuel prices and weaker demand after the Iran war. Castlelake kept coming back, and the fifth bid finally cleared the board’s bar.

Four Rejections, Then a Yes

EasyJet spent months pushing back against Castlelake. The board said earlier proposals tried to buy the airline on the cheap. The fifth offer changed the maths enough for directors to say they would recommend it to shareholders.

Nothing is signed yet. The agreement is in principle, which means Castlelake still has to put a formal offer on the table. The firm has until August 3 to do that.

What £6.90 a Share Buys

The cash offer gives easyJet an equity value of £5.2 billion, or about $6.9 billion. On a fully diluted basis the valuation rises to £5.5 billion. For shareholders who watched the stock struggle through a rough year for airlines, the premium is the whole argument.

Castlelake is a US investment house. Owning an entire airline outright is a large bet, and one it has now chased through five separate offers.

The Hurdles Still Ahead

Regulators get the next word. The deal needs approval, and EU rules require the airline to be at least 51 percent owned by EU nationals to keep its European flying rights intact. The ownership structure will need to satisfy that test.

Shareholders then vote on whatever firm offer arrives. The board’s recommendation matters, but it does not guarantee the outcome.

Castlelake has until August 3 to turn its agreement in principle into a firm offer shareholders can vote on.