United Airlines faces a shareholder revolt over the direction of the carrier just as its chief executive returns from a five-month absence during which he received a heart transplant.
Investment firms Altimeter Capital Management and PAR Capital Management, which hold a combined 7% stake in United Continental, the parent of United Airlines, want to to add six of their own nominees to the board.
They include former Continental Airlines chief executive Gordon Bethune and ex-Orbitz Worldwide chief executive Barney Harford.
Brad Gerstner, chief executive of Altimeter Capital, said that investors are “greatly disappointed with United’s poor performance and bad decisions over the last several years,” the Associated Press reported.
United merged with Continental in 2010 but unions fought the integration, customer service declined, flights were delayed and computer problems persisted.
That caused United to lose revenue and market share to rivals such as Delta Air Lines and American Airlines, despite having one of the best route networks. United is profitable but lagging behind its competition in ticket prices.
The battle over the board comes just as United chief executive Oscar Munoz returns from medical leave. Munoz became chief executive in October after United dismissed Jeff Smisek amid a federal investigation into the airline’s dealings with the government agency running one of its most important airports in New York.
However, Munoz suffered a heart attack in October and had a heart transplant In January. He is due to return to work full-time on Monday.
Bethune told CNBC that his support for the investors has nothing to do with Munoz.
“This is about governance… and having somebody who understands the airline business on the board,” he said.
Investors are dissatisfied because of United’s performance compared to its peers, he added. “If you’re in a horse race and in fourth place, you aren’t winning,” Bethune said.
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