Ryanair and Wizz Air to remove voting rights from UK investors

Ryanair and Wizz Air will strip UK investors of their voting rights from 1 January to comply with European Union rules on airline ownership.

After the Brexit transition period ends, UK and other non-EU shareholders will not be able to vote at annual general meetings, the two airlines said in separate statements.

The EU requires carriers that operate flights between two destinations within its borders to be majority controlled by EU citizens.

The Irish carrier Ryanair said restricted share notices would be issued to UK investors in due course, specifying that they cannot “attend, speak or vote at any general meeting of the company”. UK and other non-EU nationals will not be able to buy ordinary shares.

“These resolutions will remain in place until the board of the company determines that the ownership and control of the company is no longer such that there is any risk to the airline licences held by the company’s subsidiaries,” Ryanair said.

Ryanair has previously said that the airline was 55% owned by EU nationals while UK-based investors controlled 20% of the shares. Its chief financial officer, Neil Sorahan, has said that he expected half of them to re-domicile to the EU if the UK opted for a hard Brexit.

The Hungarian low-cost airline Wizz Air has a higher number of UK-based investors because it chose London for its main stock market listing.

Stripping non-EU shareholders of their voting rights will affect about 60% of its stock. If it took no action, it said more than 80% of its shares would be held by non-EU citizens, threatening its licence and its ability to fly EU-only routes.

The issue was not resolved in the Brexit agreement reached on Christmas Eve, although the UK and the EU agreed to look into a possible relaxation of ownership rules over the next year.

Daniel Röska, an analyst at Sanford C Bernstein, said airlines with a large UK investor base would either need to wait for a favourable deal or “design alternative ownership and holding structures to safeguard EU-nationality of individual airlines”.

EasyJet said last week that it would suspend voting rights of some investors on a “last in, first out” basis if necessary to ensure its EU ownership stays above 50%.


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