Stelios dashes easyJet buy-out hopes
EasyJet shares were at an all-time low today after founder Stelios Haji-Ioannou dismissed reports he was about to take the budget airline private.
With hopes of a buy-out dashed, investors sent shares in the Luton-based company down by another 3% to 145p – far off its 2002 peak of more than 500p and also its flotation price of 310p in 2000.
The decline comes amid strong competition in the sector with easyJet blaming a recent profits warning on “unprofitable and unrealistic pricing” by rivals. High oil prices have also put pressure on the £600m(€900m)-valued company.
In a statement issued over the weekend and confirmed to the London Stock Exchange today, Mr Haji-Ioannou said taking the company private would be “something of an extreme measure”. His family and trading empire easyGroup currently own around 41% of the shares in easyJet.
The entrepreneur pledged to work with the board and senior management in order to protect shareholder value but warned that “we would obviously be free to take a different line” in the event of any further deterioration in the share price.
Mr Haji-Ioannou said there were “many other steps” that could be considered before going private, including his contractual right to take back the chairmanship. He said it was only something he would do in extreme circumstances and not a job he was after.
He added: “Taking easyJet private at this would, in my view, be something of an extreme measure.”
Despite the pricing pressure, easyJet has continued to see passenger numbers spiral with 2.24 million people flying on its planes during June. The launch of new services, particularly to Germany, have boosted the performance.
