From the Guardian
"The gravy train of £180m free shares issued over the last decade must come to an end," says Sir Stelios Haji-Ioannou, founder of easyJet. Wow, that's a striking statistic – £180m equates to about 10% of the company's market valuation.
But is it the whole story? EasyJet thinks not – and one can understand why. It says that 30.7m out of 41m shares issued to employees since 2000 relate to pre-flotation schemes put in place by Haji-Ioannou himself. Indeed, he seems to have been generous in spreading the fruits of easyJet's success. It was not only executives in the early years who benefited – pilots and cabin crew did too. Good for Haji-Ioannou, he was ahead of his time in promoting staff share ownership – but, come on, he shouldn't include those shares in an allegation that the board (on which he sat for most of the decade) has been too loose with other people's money.
Also, according to easyJet, other elements within the "£180m gravy train" include share options, rather than share awards. It's the profit above the strike price (ie the specified price at which an option may be exercised), that is the gravy, not the value of the shares themselves – and easyJet's number-crunchers reckon the real value was £17m. That's still a lot, but it's not as startling as advertised.
Haji-Ioannou's broader charge that easyJet is using a flattering calculation of return on capital employed – the benchmark proposed for the current contentious long-term incentive plan – is a more interesting argument. He should stick to it.