Shareholders - Who actually manages?
ib16uk - One of the problems with going public is that the shareholders, especially the large institutions like pension funds, put expectations on the management of the company that may be at odds with what could work best. The execs end up trying to move forward with one hand tied behind their back as they have to show growth in margin, increased dividend etc often before they can look at positive inward investment (something that grows the company but may include an element of risk - such as opening up ops at a new airport).
One major problem with the shareholders is that they measure companies in a sector against each other usually by numbers. For example if SWA and Ryanair are showing aggressive cost control whereby their operating costs are x% of turnover, then shareholders may look at other airlines and expect the same everywhere without looking too deeply at the underlying factors. EJ may well run a newer fleet of aircraft which probably cost more in leasing than Ryanair - from a shareholder perspective thats not good news, yet from a passenger perspective I know which I would sooner travel on.
Also where execs have good ideas, they have to go back to the city to finance them. If Stelios is bring the company back into private ownership, a little lkike Branson did, then financing new ideas becomes easier (Stromin Norman has the right track there).
Personal perspective here is that a lot of organisations get more flexibility when privately owned than publicly. I suspect that if this happens then it could put EJ on a more competitive footing again.