Carl Icahn’s efforts to secure seats on JetBlue Airways’ board of directors have succeeded, as confirmed in a statement from the airline on Friday.
This comes shortly after Icahn disclosed his ownership of nearly 10% of the New York-based airline and his negotiations for board representation.
The two newly appointed directors are Jesse Lynn, serving as general counsel of Icahn Enterprises, and Steven Miller, a portfolio manager at Icahn Capital.
Following the announcement, JetBlue’s shares experienced a roughly 4% increase in after-hours trading.
Icahn’s involvement with JetBlue marks his return to the airline industry. Notably, in one of his past activist campaigns, he took TWA private in the late 1980s, a move that ultimately led to the airline’s struggles and eventual bankruptcy.
In his disclosure of the JetBlue stake, Icahn emphasized his belief in the undervaluation of the company’s shares. JetBlue’s stock has declined by over 19% in the past 12 months, contrasting with the approximately 7% increase in the NYSE Arca Airline Index over the same period.
The recent appointment of Joanna Geraghty as JetBlue’s new CEO signals a fresh direction for the carrier. Geraghty, alongside a pair of experienced airline veterans, aims to steer JetBlue toward profitability and operational stability.
In response to the developments, Geraghty expressed optimism, stating, “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.”
JetBlue’s financial performance has been marred by losses since the onset of the Covid-19 pandemic.
To address this, the airline has embarked on cost-cutting measures and endeavors to enhance reliability amid a resurgence in travel demand following the pandemic.
Additionally, JetBlue’s proposed merger with budget carrier Spirit Airlines was recently blocked by a federal judge, citing concerns over diminished competition. Both JetBlue and Spirit are appealing the ruling in hopes of overturning the decision.
