EasyJet founder and largest shareholder Sir Stelios Haji-Ioannou today blasted the budget carrier for maintaining a huge order for new aircraft while agreeing a £600 million government loan.
He accused the airline of borrowing the money from the UK taxpayer to help pay Airbus billions of pounds for new aircraft.
Sir Stelios urged the airline to terminate the £4.5 billion Airbus outlay “for easyJet to survive”.
His broadside followed easyJet grounding its entire fleet for two months due to the coronavirus crisis.
Sir Stelios said: “If the French government wants to spare Airbus from the cost of aircraft order cancellations, so they can keep French people in jobs, then they must give such support as French state aid and not expect a British airline to foot the bill.”
Sir Stelios threatened to sue for “breach of fiduciary duties” if “a penny of easyJet’s monies goes to this non-UK supplier (Airbus) while easyJet defaults on its other financial obligations in the future (e.g. if it fails to repay the UK government loan in March 2021).”
He has had numerous disputes with the easyJet board and today called for shareholders to remove two directors, including chief financial officer Andrew Findlay, “in order to stop him from signing any more billion-pound cheques to Airbus every year for new useless aircraft”.
Urging the Airbus contract to be terminated, Sir Stelios added: “With all 330 planes on the ground there is no bigger business to deal with than the £4.5 billion liability to Airbus.”
A government loan for a year “is not the solution to easyJet’s problem of having zero revenues,” he said.
“I have generally been at odds with the various directors from time to time and the way they are running the company, particularly about them ordering more and more planes from Airbus.
“This generally legitimate corporate tension between the paid managers and a shareholder reached an all-time low this week.
“These are unprecedented times and easyJet has zero revenues as we speak.
“When was the last time in the history of aviation that one airline went from having £6 billion in revenues per year to zero revenues inside one month with no firm date set in the future for returning to carrying fare paying passengers?
“Why are these directors of easyJet so keen to keep paying Airbus for additional redundant planes?”
EasyJet said: “The board is managing the unprecedented challenges facing the aviation sector to ensure the long-term future of the airline.
“We remain absolutely focused on removing expenditure from the business, engaging with all of our business partners and suppliers including Airbus, and on safeguarding jobs and short-term liquidity.
“This is why we moved to secure an additional £600 million through the UK Government’s CCFF and $500 million through our existing revolving credit facility.
“EasyJet has a strong asset position and balance sheet. Our efforts to secure funding now are being carefully weighed against the long-term financial health of the airline and the CCFF gives easyJet access to funds at the sort of commercial rates which were available before the coronavirus crisis.
“The board fully supports Andrew Findlay, easyJet’s CFO and stands by its collective decision to access the CCFF which was made in the best interests of the company.
“We continue to believe that holding a general meeting would be an unhelpful distraction from tackling the many immediate issues our business faces.”