JetBlue Airways confirmed Friday that Carl Icahn succeeded in his bid for seats on the airline’s board of directors, following his recent disclosure of a nearly 10% stake in the New York-based carrier and discussions regarding board representation.
The airline announced the appointment of two new directors: Jesse Lynn, the general counsel of Icahn Enterprises, and Steven Miller, a portfolio manager at Icahn Capital. Following the announcement, JetBlue’s shares experienced a 4% increase in after-hours trading.
This investment marks Icahn’s latest foray into the airline industry. Notably, he led an activist campaign in the late 1980s to privatize TWA, which subsequently faced challenges and filed for bankruptcy.
In revealing his stake in JetBlue, Icahn expressed his belief that the company’s shares are undervalued. JetBlue’s stock has declined by more than 19% over the past 12 months, contrasting with a 7% increase in the NYSE Arca Airline Index during the same period.
The airline welcomed its new CEO, Joanna Geraghty, on Monday, alongside the appointment of two seasoned airline executives to steer the company back on course.
“Building on our distinct brand and unique value proposition, we are focused on delivering value to our shareholders and all of our stakeholders, and we welcome the contributions of our new board members as we move forward with that common goal,” Geraghty stated in Friday’s announcement.
JetBlue has faced financial challenges since before the Covid-19 pandemic and has been implementing cost-cutting measures to enhance reliability following a surge in post-Covid travel demand and a thwarted merger attempt with budget carrier Spirit Airlines.
A federal judge recently rejected the proposed merger, citing concerns about diminished competition. JetBlue and Spirit Airlines are appealing the ruling, contending that the merger is crucial for JetBlue to effectively compete against larger American carriers.
