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Bust-up at Easyjet
Will Sir Stelios attempt to take Easyjet private?
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Jasper Kelly Tuesday 18 May 2010 |
Easyjet’s policy of investing heavily in new aircraft in advance of an upturn in the aviation market has been attacked by former owner, Sir Stelios Haji-Ioannou.
Since the company’s flotation, CEO Andy Harrison has followed an aggressive policy of fleet expansion by purchasing aircraft at very competitive prices. In normal circumstances, this could be seen as a good use of the company’s continuing profits. At the moment, with the airline industry hurting at all levels, Sir Stelios is attacking the policy. His resignation from the board of directors has led some to suggest that he may be about to lead a bid to take the company back into private ownership.
Although Standard Life, as one of the major shareholders, expressed itself happy with the current management team and policies, other shareholders are reported to be concerned that hard won profits have not resulted in dividends or meaningful increases in shareholder value.
Of course, at the moment with the industry in turmoil, it is easy to be critical. Give it six months, some good news and a shortage of short-haul aircraft and the critics may have to eat their words.
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Amanda Hughes, Dewsbury 21 May 2010, 06:13AM | |
One of the nicer things about flying Easyjet is that they do seem to have modern aircraft. I know that all aircraft are maintained to the same standard and that old age does not mean that it unsafe or anything. But it is nice to feel that you are in a clean modern plane. I hope they carry on investing. | |
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Stuart D, Coventry 25 May 2010, 11:25AM | |
I would like to see Easyjet take the opportunity with their new aircraft to improve the interior design, wider seats, bigger toilets etc and also take steps to reduce carbon emissions. | |
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I am sad to read about this. I have used Easyjet and found them to be a good carrier. I also like the style of Sir Stellios. Not all of his Easy-this and Easy-that ideas worked but he did try to bring out reasonable services at reasonable costs. | |
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Graham Wilks, Croydon 26 May 2010, 11:21AM | |
Can someone tell me how this works? What might Sir Stelios have to pay for the company and what would the shareholders end up with bearing in mind both parties want the opposite? | |
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Penny Smith, Brighton 27 May 2010, 06:20PM | |
The big issue is the licensing rights to use the Easy brand. Sir Stellios wants more money if Easyjet use it for non-airline activity. Easyjet need to increase their revenue and so want to get into more things like car hire and hotel bookings. | |
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Marion Palmer 27 May 2010, 06:39PM | |
Easyjet do have good aircraft. I am not sure that it matters that much to passengers because all we want to do is get to the destination and then back home on-time and without delays. But, having used both Ryanair and Easyjet, you do notice the difference. They have probably wasted their money but all credit to them for trying. | |
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Helen T, Docklands 28 May 2010, 01:24PM | |
Yes, this is probably a bad investment for Easyjet at the moment, but I guess time will tell if the airline industry will recover sufficiently for the new fleet to be in demand. | |
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Robert Grey 1 June 2010, 12:16PM | |
Easyjet had to cancel more than 6,500 flights as a result of the volcanic ash and said at the financial results that the disruption would cut annual profits by up to £75m. The £78.7m loss for the six months to the end of March was an improvement on the £129.8m loss a year ago, so perhaps they can afford the expansion. | |
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