Jan 29, 2017
Airline investors face forced sale after Brexit
Some Ryanair and easyJet shareholders could be ordered to sell their stakes to EU nationals after Brexit if airlines are forced to use drastic legal powers in the scramble to comply with the bloc's foreign ownership rules. The prospect of such mandatory share sales is one of many legal problems facing the industry in the wake of Brexit as Britain attempts to refashion the thicket of regulations and treaties underpinning international airline markets. IAG, the parent company of British Airways, also has provisions to force non-EU shareholders to divest within 10 days in the event of their licence coming under threat, but it declined to say what percentage of its shareholder base would be EU-national post-Brexit. Under their company rules, Ryanair, easyJet and IAG can issue a "Restricted share notice" to non-EU shareholders, depriving the holder of the right to attend, vote and speak at general meetings, and requiring the holder to sell the shares to an EU national within a number of days. Aviation lawyers say airlines will search for alternative means of complying with the rule, including share buybacks and courting those in EU shareholder bases.
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