EasyJet founder digs in on battle with management over
Airbus order
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 [April 06, 2020] LONDON
(Reuters) - Stelios Haji-Ioannou, easyJet's <EZJ.L> founder and biggest
shareholder, on Monday intensified his battle with the airline's
management over a huge aircraft order with Airbus <AIR.PA> which he says
it should cancel.
Haji-Ioannou said in a statement that he had told the airline he would
not provide it with any new equity until it terminates a 4.5 billion
pound deal with Airbus. He said he tried to change the company's stance
by calling for the removal of two of its directors.
Stelios, as he is better known, says that the 107 planes on order are
"useless", after the coronavirus pandemic brought air travel to an
almost standstill. The huge bill for the planes puts easyJet's survival
at stake, he said.
Airlines across the world are struggling to say afloat. Whole fleets are
now grounded, including easyJet's 344 planes, due to travel restrictions
and plunging demand over fears of contagion.
Stelios said easyJet will run out of money by August and said he would
not help it financially until the Airbus order is cancelled. He also
said he wants easyJet to reduce its fleet size to 250.
Britain has told its airlines to raise new money from shareholders
before it would consider helping them. While easyJet is taking advantage
of government help schemes for businesses, it has not requested any
specific state bailout.
INFLUENCE
Under UK company rules, Stelios's only way of influencing management's
behaviour is to call for a shareholder meeting to vote for the removal
of directors.
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Easyjet founder Stelios Haji-Ioannou speaks at a media event to
celebrate 20 years in business at Luton Airport, southern England,
November 10, 2015. REUTERS/Eddie Keogh/File Photo
He plans to write to easyJet's chairman to call for two directors to be removed,
adding Chief Financial Officer Andrew Findlay to an earlier call for the removal
of Andreas Bierwirth.
"Terminating the Airbus contract is the only chance current shareholders have to
maintain any value in their shares," Stelios said in his statement.
Airbus has said the order from easyJet is firm, meaning binding, while the
airline said on Monday its focus was on short-term liquidity to ensure its
future.
"We believe that holding a general meeting would be an unhelpful distraction
from tackling the many immediate issues our business faces," the company's
spokeswoman said.
The Luton-based budget airline on Friday rejected Stelios's first call for a
general meeting to remove Bierwirth on what Stelios's team called a
technicality, but a meeting, held electronically, will have to go ahead at some
point, his spokesman said.
"I fully expect easyJet to follow the stipulations of the Companies Act 2006 and
to call a meeting within a three week period," said a spokesman for Haji-Ioannou.
The Haji-Ioannou family owns about a third of easyJet's shares and Stelios has
been a long-time critic of the airline's expansion plans.
($1 = 0.82 pounds)
(Reporting by Sarah Young in London, additional reporting by Juby Babu in
Bengaluru; editing by Diane Craft and Angus MacSwan)
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