EasyJet deal to end Stelios row

Long-running disagreement to end after EasyJet agrees a deal.

Travel Insurance News - 11/10/2010

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Budget airline easyJet announced it has agreed to a deal that will see the end of a long-running feud with company founder Sir Stelios Hafi-Ioannou. The agreement will secure easyJet’s use of the brand created by Stelios.

The agreement with Sir Stelios will see the low-cost airline paying millions of pounds a year to end the increasingly acrimonious dispute during which Sir Stelios criticized strategy at the airline. Had easyJet failed to come to an agreement with Sir Stelios, it could have been forced to drop its use of the ‘easy’ brand.

EasyJet has agreed to pay Sir Stelios 0.25 per cent of its annual revenues. The revenue payment is fixed at £3.9 million in the first year of the agreement and £4.95 million in the second year. In addition, easyJet will pay a further £300,000 per year.

Sir Stelios in turn has agree to revise the terms of the brand licensing agreement. The airline will be allowed more freedom and the clauses that had allowed Sir Stelios to take over the role of chairman are removed. Sir Stelios and his family control some 37 per cent of eayJet. He described the agreement as a “win-win”. Announcement of the agreement led to shares in the airline rising five per cent.

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