Hedge Funds That Launched Boardroom Fight With United Continental Oppose Plans To Give CEO Role Of Chairman, Concerned About His Pay
PAR Capital Management Inc and Altimeter Capital Management LP, the two hedge funds that launched a boardroom fight with United Continental Holdings Inc (NYSE: UAL), is said to oppose the airline's plans to give CEO Oscar Munoz the additional role of chairman and have concerns about his compensation, according to a report on Reuters.
The report, citing people familiar with the matter, said they're expected to lay out more specific claims about the company in coming weeks that tackle what they believe are the causes of the No. 3 U.S. airline's low customer satisfaction scores and its sagging stock.
Shares were down 13 percent in the last year.
PAR and Altimeter also believe the board's decision to give Munoz a signing bonus of $12 million should have been tied to performance goals, the report said.
Altimeter Capital and PAR Capital, which together own about 7.1 percent of United's outstanding common stock, wanted the airline to add six new directors including Gordon Bethune, former CEO of Continental, which merged with United in 2010.
Related Link: Activists Push United...And United Pushes Back
Bethune will lead the dissidents' slate, which includes Altimeter founder Brad Gerstner and former Orbitz CEO Barney Harford at its 2016 Annual Meeting.
The shareholders' announcement came after the company added three new directors to its Board on March 7, 2016, while simultaneously expanding its Board size from 12 to 15 directors.
Shares of United gained 1 percent Monday to $58.95.
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