Sir Stelios Haji-Ioannou will use some of his easyJet shares to vote against the airline’s chairman at its annual general meeting in a protest against the company’s dividend policy and falling share price.
EasyJet’s founder said he would use a token 20m shares, not his full 34% stake, to oppose John Barton’s re-election to the board at Thursday’s meeting. Haji-Ioannou said he did not want to unseat Barton but that he wanted the board to agree to pay 50% of profits in dividends with surplus used for share buybacks.
Haji-Ioannou said easyJet lacked a clear dividend policy and this had contributed to the poor performance of the company’s shares. He compared the 12% fall in easyGroup’s share price in the past two years with the 87% increase in the value of Ryanair, its budget carrier rival.
Haji-Ioannou, whose easyJet stake is held via his easyGroup investment company, said the airlines’ contrasting performance was partly because Ryanair had used share buybacks to increase shareholder returns, whereas easyJet had paid less predictable special dividends.
“In the last five years, the easyJet board’s scattergun approach has meant a haphazard mixture of ordinary and special dividend payments that has left investors confused and uncertain as to the company’s intentions when rewarding shareholders,” he said.
“It is not easyGroup’s intention to remove John Barton, whose performance to date has been highly satisfactory. However, directors will need vigilance against a background of a 23% share price deterioration in the last 52 weeks.”
Haji-Ioannou has clashed on several occasions with the board of the airline he founded in 1995. In 2013 he failed to block easyJet’s £8bn order of new aircraft, which he attacked as a vanity exercise. The year before he almost removed Barton’s predecessor, Sir Mike Rake, and criticised pay deals for top executives. He has also sought to block pay deals for directors of Fastjet, which he helped found, and easyHotel, the hotel chain in which he has a 49% stake.
The billionaire entrepreneur called on easyJet’s board to clamp down on briefing against him and said he was prepared to sue people who made “malicious allegations” about him and his family.
An easyJet spokesperson was not available to comment.
