Stelios calls for removal of Fastjet CEO

Fastjet's chief executive, Ed Winter. Picture: Supplied

Fastjet's chief executive, Ed Winter. Picture: Supplied

Published Mar 1, 2016

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London - Stelios Haji-Ioannou, Fastjet’s second-largest shareholder, called for an investor meeting for the immediate dismissal of the African budget airline's chief executive, Ed Winter.

Haji-Ioannou, whose private investment vehicle easyGroup has a 12 percent stake in Fastjet, said Winter had created significant overheads for the company, resulting in a high cost base that was disproportionate to its six aircraft fleet.

“At the current cash burn rate we believe the company will run out of cash sometime in 2016,” said Haji-Ioannou in a letter on Monday.

“We now have about six months left to steady this ship. Time is of the essence.”

Fastjet in a separate statement said it felt it had made considerable progress towards its goal to become the first low-cost pan-African airline “despite facing significant challenges outside its control”.

The budget carrier said in December that it was taking steps to manage its operating costs and overheads, after issuing its second warning on full-year 2015 revenue.

Currently operating from bases in Tanzania and Zimbabwe, Fastjet has aspired to undercut larger carriers by offering “no frills” services, replicating a model pioneered by European airlines like easyJet and Ryanair.

A spokesman for Fastjet declined to comment further, when asked about Haji-Ioannou's proposals.

Haji-Ioannou, commonly known as Stelios, started Fastjet in 2012 along with Winter, after his relationship with easyJet Plc , the low-cost carrier he founded in 1995, turned turbulent.

Winter was easyJet's chief operating officer earlier.

Haji-Ioannou is no stranger to activism and has over the past years frequently disagreed with easyJet over issues such as fleet expansion, executive pay and dividend policy.

Haji-Ioannou said on Monday Winter should be removed immediately and Non-Executive Chairman Colin Child should handle an executive position until a replacement was appointed.

He also said he would also seek the removal of Krista Bates as a board director.

The news comes just over a month after Fastjet said Winter intended to step down as CEO, but did not give any clarity around the timing of his imminent exit.

The carrier has seen significant changes among its top management. Child has been chairman for just over five months and the company recently named a new finance chief.

REUTERS

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