Sir Stelios Haji-Ioannou, founder of easyJet, has given notice that he plans to start a rival carrier.
On a day when relations between easyJet and its largest single shareholder slumped, a single web page tantalisingly advertised the new airline.
On a bright red background – in stark contrast to easyJet’s mellow orange – it read in white print Fastjet.com by Stelios. Coming soon!
The move will increase tensions between Sir Stelios and the easyJet board, already deeply strained after months of wrangling over the size of the planned new fleet and the directors’reluctance to pay shareholder dividends.
This was partly resolved last week when the low cost carrier, launched in 1995, declared it was on course for a pre-tax profit of £250m and would pay not only a dividend but also a one off payment to shareholders.
It amounted to a payment of nearly £72m to Sir Stelios and his family, who between them own 37% of the eayJet shares.
Sir Stelios handed over day to day running of the carrier in 2000 after it was floated on the London Stock Exchange, a move which brought him a personal payment of around £280m.
The deal was that the carrier would pay Sir Stelios’s company, the easyGroup for the use of the “easy” name for running an airline only.
Further rows resulted in the carrier paying easyGroup a percetnage of its revenues from ancillary sales, like baggage charges. This amounted to around £5m a year.
The deal also paid Sir Stelios £300,000 a year for five years to stop him using his name to start a rival airline in Europe.
It is this agreement which Sir Stelios has now torn up. He claimed his grounds for taking this action were that a clause committing him and the carreir to enhance their separate reputations had been broken.
In a statement Sir Stelios’s company easyGroup said: “Sir Stelios strongly believes that the directors of easyJet, via a smear campiagn conducted by off-the-record briefings to journalists, have repeatedly breached the clause, so he has terminated the effect of the letter for repudiatory breach and has rejected all payments offered under this letter since May 2011.”
Sir Stelios blamed his move on the easyJet board. In fact there were indications yesterday that it was the board that actually leaked information of Sir Stelios’s new venture.