EasyJet PLC’s (LON:EZJ) founder and major shareholder Stelios haji-Ioannou has requisitioned a meeting to remove non-executive Andreas Bierwirth and CFO Andrew Findlay as directors of the airline.
The move follows a threat yesterday to sue the EasyJet’s executives if the carrier went ahead with a £4.5bn plane order from Airbus.
In a statement yesterday, 34% shareholder Ioannou said he would start legal action if it spent ‘a penny’ on new planes from what he describes as a Franco-German arms manufacturer.
“With all [Easyjet’s] 330 planes on the ground there is no bigger business to deal with than the £4.5bn liability to Airbus,” he wrote.
In the statement, Ioannou singled out CFO Findlay, suggesting that the reason he wants to borrow £600mln from the UK government to carry it through the coronavirus crisis is to pay Airbus.
Describing it as a misuse of taxpayers money, ioannou added the Airbus order might result in the airline failing to repay the money to the UK government.
The tycoon called for a meeting last week to remove Bierwirth, a move EasyJet rejected though Ioannou said this was on a technicality that has now been corrected.
Unless the airline agrees to a vote on Findlay, he will call meetings to remove more directors said the statement, he said.
Previously, he had said he will seek to remove one board member every seven weeks until the Airbus order is cancelled saying the airline might run out of money by August otherwise.
Separately, Goodbody said the airline’s financial situation might not be as dire as painted.
The Irish broker expects the three no-frills carriers – easyJet, Ryanair and Wizz Air- to post combined losses of €2bn for 2020, but to stage an equally strong recovery in the following year although it might take longer for Luton-based easyJet.
EasyJet has 11-12 months of cash burn, it says, assuming no flights at all.
“With the FY21 year still impacted by the current crisis (Q420 trading) and given fuel hedges (51%) at US$638/MT, the recovery year is seen as FY22,” it said.
Due to the strong share price revival over the past few days, it is downgrading its investment rating to ‘hold’ from ‘buy’
The broker estimates the airline’s net present value at 710p compared to a share price of 631p, down 0.7% today.
— adds meeting news, broker comment, share price —