Go chiefs stay after £374m easyJet takeover

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The Independent Online

EasyJet is to offer multimillion pound incentive packages to key executives at Go in a bid to keep them on board after its £374m takeover of the rival no-frills airline yesterday.

Barbara Cassani, the chief executive of Go, will make about £15m from her 4 per cent stake in the business and has decided to quit as soon as the deal is completed.

But easyJet has persuaded three other senior directors to stay on with the use of "golden handcuffs". The three, chief operating officer Ed Winter, sales and marketing director David Magliano, and director of customer services Dominic Paul, will receive the lion's share of a pot worth £11m. EasyJet executives and other staff will also receive incentive packages.

The takeover will enable easyJet to leapfrog Ryanair as Europe's biggest no-frills airline and is being funded by a deeply discounted £277m rights issue and £113m in cash. EasyJet is offering existing shareholders four new shares for every 11 held at a price of 265p, a 42 per cent discount to Wednesday's closing price.

Despite the steep discount, easyJet shares rose sharply as the City endorsed the deal. The shares closed 11 per cent higher at 510p ­ more than a pound above the theoretical ex-rights price.

Stelios Haji-Ioannou, the founder of easyJet, will see his stake fall from 27.5 per cent to 24 per cent and will make no cash from the takeover. Together with his brother and sister, the family shareholding in easyJet will fall to 48 per cent.

Ray Webster, easyJet's chief executive, who has previously described the takeover as a "no-brainer", pledged there would be no significant job cuts among the combined staff of 2,800, no route closures and no attempt to ratchet up ticket prices.

He also paid tribute to Ms Cassani, despite the fact that she tried to persuade Go's majority shareholder to reject easyJet in favour of a stock market flotation. "I respect Barbara's views and I think she has done a fantastic job in taking a fledgling company to where it is now," he said. "Naturally she is disappointed she can't see the company she's brought on through to flotation."

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