July 1 (Bloomberg) -- EasyJet Plc founder and No. 1 shareholder Stelios Haji-Ioannou said he will vote against a management plan to buy 135 Airbus SAS jets valued at $13.2 billion, citing a lack of transparency to the transaction.
“It is my firm opinion that this is a good deal for Airbus and a bad deal for EasyJet shareholders,” Stelios, who is known by his first name, said in a letter to fellow investors in Europe’s second-largest discount carrier.
The founder, who said he expects the transaction to be approved in a vote on July 11, owns just less than 37 percent of the company. Standard Life Investments and Prudential Plc’s M&G Investments declined to comment on their voting intentions. They own about 8 percent and 5.3 percent of the shares, respectively, according to data compiled by Bloomberg.
EasyJet agreed on June 18 to buy 135 A320 single-aisle planes, with an option for 100 more as it goes head-to-head with network carriers such as British Airways by targeting a bigger share of Europe’s business-travel market. Some 85 of the 135 aircraft will replace old jets, with the remainder helping to boost seat capacity by 3 percent to 5 percent annually, the carrier said last month.
“I am not against replacing aircraft that have reached the end of their economic life,” Stelios said. “However, I am against buying aircraft that are three times more expensive than the ones I bought with my own money in the early 2000s.”
EasyJet declined to comment on the letter when contacted by Bloomberg News today.
Stelios, who trimmed his holding earlier this year and threatened to sell more shares if the airline added new planes, said he was “disappointed” that Chairman John Barton, who joined this year, approved a large transaction so quickly. He also expressed concern that shareholders are being asked to approve a deal without clear price information.
Carriers typically buy airliners at a discount, and the price per plane isn’t revealed, at the manufacturer’s request.
Standard Life and M&G have supported the board during previous disputes. Both investors voted against Stelios and in favor of management in August last year to keep then-chairman Mike Rake in his position.
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