Stelios drops calls for easyJet board change after payout

 

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The Independent Online

Sir Stelios Haji-Ioannou has suddenly dropped his demand for a shareholder vote to expel an easyJet board member, just a day after landing a £72m windfall from the budget airline he founded.

EasyJet announced that Sir Stelios' easyGroup conglomerate had withdrawn its request for an extraordinary general meeting to remove Rigas Doganis as a non-executive director.

Sir Stelios, who is easyJet's largest shareholder with a 38 per cent stake, had called for the departure of Mr Doganis as part of his campaign to force the group to pay a huge dividend rather than spend its profits on expanding its fleet.

Mr Doganis, a former chief executive of Olympic Airways who has been at easyJet for six years, is thought to have supported a deal in January to order 35 new aircraft from Airbus, which the tycoon strongly opposed.

A spokesman for the airline said: "The board of easyJet welcomes this withdrawal as it viewed an emergency general meeting as an unnecessary and costly distraction. EasyJet looks forward to engaging constructively with easyGroup as it does with other shareholders."

Carolyn McCall has denied Sir Stelios' windfall – part of a £190m payout announced on Thursday – had anything to do with his repeated demands for the removal of easyJet board directors.

She added that increasing uncertainty about the outlook of the eurozone economy had boosted investors' appetite for cash, prompting the airline's special dividend.

Sir Stelios, who resigned from the board last year, dropped his claims a day after easyJet announced a £40m, or 9p a share, ordinary dividend and a £150m special dividend, bringing the total payout to 44p a share.

The payout was made possible, in part, by the budget airline's increasing good fortune.

The company, which on Thursday began taking bookings for its latest route, from Bristol to Naples, had previously announced that it would pay its first ordinary dividend this year, although only put a number on it on Thursday.

Ms McCall accompanied her dividend announcement on Thursday with an upbeat trading statement, in which she raised her pre-tax profit guidance for the year to between £240m and £250m from its previous forecast of £200m to £230m.

"The increase in total revenue per seat for the second half of the year is likely to come in towards the upper end of our expectations – at about 6 per cent – and will be about 3 per cent for the full year," Ms McCall said.

In July, Sir Stelios called for a shareholder vote on the removal of director Sir David Michels. Sir David stepped down rather than go through with the vote. The airline's founder targeted Sir David over a £1m payment to Andy Harrison, easyJet's former chief executive, whom Sir Stelios criticised again for expanding the airline's fleet. Sir Stelios' windfall comes a year after he renegotiated a deal with easyJet that would have paid him £1m a year into one that pays him £4m. The payment was part of a deal to settle a two-year row with the airline over branding.

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