1. ITV Report

Easyjet faces showdown with Sir Stelios

Easyjet will try to face down a revolt by founder and largest shareholder Sir Stelios Haji-Ianonnou Photo: Barry Batchelor/PA Wire/Press Association Images

Luton-based Easyjet will try to face down a revolt by founder and largest shareholder Sir Stelios Haji-Ianonnou when it asks investors to approve the multi-billion pound purchase of up to 235 new Airbus planes.

Sir Stelios, who with his family controls a near-37% stake in the airline, has attacked the proposed deal and urged fellow shareholders to join him in voting against it.

In an open letter to them last week, he claimed that it was "a good deal for Airbus and a bad deal for easyJet shareholders" though he acknowledged the board was likely to win the vote.

The airline has not responded specifically to the attack, saying that it had nothing to add having already set out its plans for the deal in great detail to investors.

Luton-based Easyjet founder Sir Stelios Haji-Ianonnou pictured in 2005 Credit: Chris Radburn/PA Archive/Press Association Images

EasyJet wants to upgrade and expand its fleet by acquiring 135 Airbus planes over the next nine years.

It has ordered 35 current generation A320 planes for delivery between 2015 and 2017 and 100 new generation A320neo aircraft from 2017 until 2022. There is also an option to buy a further 100 Airbus planes as part of the deal.

The no-frills carrier said it had secured a steep discount for the aircraft but did not disclose the cost of the deal. At the list price it is thought to be worth £11.9 billion.

The deal is expected to allow easyJet to boost passenger numbers from the current level of 60 million a year to around 90 million.

Recent figures show they have continued to soar, with the company yesterday revealing it carried 100,000 more in June than in the same period last year, a 1.9% rise taking the monthly total to 5.5 million.

Easyjet founder and largest shareholder Sir Stelios Haji-Ianonnou Credit: PA

The new purchase will see 85 of easyJet's current 211-strong fleet replaced and give the airline room to expand and add routes.

The scale of the deal means the airline must win the approval of 50% of investors at the meeting due to take place on Thursday.

Sir Stelios has strongly resisted the move, writing to fellow investors this week setting out his objections over what he described as a "secret deal with Airbus" and threatening to hold the board legally to account should it damage shareholder value.

"I am not against replacing aircraft that have reached the end of their economic life. However I am against buying aircraft that are three times more expensive that the ones I bought with my own money in the early 2000s."

– Sir Stelios Haji-Ianonnou
Three of the top ten shareholders told the Financial Times they were likely to back the Easyjet management plans. Credit: Bernd Settnik/DPA/Press Association Images

Chief executive Carolyn McCall is expected to attend the meeting in Luton along with the rest of the board. A spokesman for Sir Stelios said he was unlikely to be there in person.

Three of the top ten shareholders told the Financial Times they were likely to back the management plans.

One said: "This looks like a sensible deal for the company and will help them grow and take on the big flag carriers."