Stelios threatens to launch easyJet rival called Fastjet

The row over company strategy between easyJet’s board and Sir Stelios Haji-Ioannou has taken an unexpected turn, with its founder and largest shareholder telling the board yesterday that he “intends to set up an airline branded Fastjet”. Analysts have dismissed the threat as a ploy to wring more concessions from easyJet simply because launching an airline in the UK low-cost market would be very difficult to establish. Moreover, Haji-Ioannou is contractually prevented from acquiring more than 10% interest in another airline licensed in the European Economic Area for another two years. EasyJet has indicated it will enforce this contract in court if pushed. However, Haji-Ioannou says the contract was voided since easyJet directors had breached its provisions through “a smear campaign conducted by off-the-record briefings to journalists”. Haji-Ioannou has not commented on any plans to establish a rival airline and stated that he remained “committed to enhancing the reputation of the EasyJet brand and the Easy brand in general”. The dispute stems from an aircraft order Haji-Ioannou believed should not have been approved by the board as too expensive and has berated the board for not focusing on shareholder returns. Even so, the airline announced its first-ever dividends, worth £190m, last week.