easyJet ‘stands ready’ with no-deal Brexit contingency plan
easyJet has said it continues to “stand ready” to activate its contingency plan should Britain leave the European Union without a deal in the next few weeks.
The future relationship between the EU and UK remains in flux following a decision by UK prime minister, Theresa May, to request more time to get a deal passed parliament.
The UK will currently leave the EU without a deal on April 12th, unless a compromise can be reached.
In this scenario, EU rules stipulate an airline must be more than 50 per cent owned by EU-based shareholders if it wishes to keep operating within the bloc.
Airlines will have six months to comply with the rules, provided that an acceptable remedial plan is submitted to authorities.
easyJet said this morning that its EU (excluding UK) ownership stood at 49.92 per cent, just below the required share.
“Accordingly, the board continues to stand ready to activate the contingency plan of suspending shareholders’ voting rights in respect of a small number of shares on a last in first out basis, in accordance with existing provisions of our articles of association.
“For the period of any such suspension, the relevant shareholders would not be permitted to attend, speak or vote at shareholder meetings in respect of the shares subject to the suspension.”
While the EU regulations make it unlikely that the airline will be required to take any immediate action to implement the permitted maximum or contingency plan in connection with Brexit, the timing of implementation (if required) will depend on the outcome of Brexit negotiations, easyJet added.
In the longer-term, easyJet would likely transfer a minimum of 50 per cent ownership to European parties.