United Continental Shareholders Re-elect Board
June 08 2016 - 2:00PM
Dow Jones News
Fresh from an April settlement with investors that staved off a
proxy fight, United Continental Holdings Inc. common shareholders
on Wednesday reelected five directors, including two who were
chosen to represent the investors and three the airline had named
to the board a day before the proxy contest began in early
March.
At United's annual meeting Wednesday, a total of 12 directors
were re-elected by a majority of the common shareholders, and two
others were re-elected to represent labor. As part of the
settlement with PAR Capital Management and Altimeter Capital
Management LP, which own more than 7% of United's shares, United
soon will add a 15th director by mutual agreement.
Oscar Munoz, United's chief executive, said after the annual
meeting that the panel will look at board candidates in the coming
months. He said he expects that person to be in place by the next
board meeting, which is slated for September.
The settlement with PAR and Altimeter also called for new United
director Robert Milton, a former CEO of Air Canada, to be named
nonexecutive chairman of the airline. The company said the board
went to a meeting after the annual assembly to take that step. The
settlement also calls for Mr. Munoz to refrain from adding the
chairman's role until 2018, not 2017 as previously planned.
Mr. Milton was one of three directors added to United's board in
early March after PAR and Altimeter had indicated they planned to
take a more active role in United's governance and strategy. The
others were James Whitehurst, a former Delta Air Lines Inc.
executive who now helms technology firm Red Hat Inc., and James
Kennedy, former CEO of T. Rowe Price Group Inc., an investment
management firm.
Representing PAR and Altimeter are Barney Harford, former CEO of
online travel agency Orbitz Worldwide, and Ed Shapiro, PAR's
managing partner, who is taking a temporary break from his
investment firm duties to serve on United's board and another
board.
At the annual meeting, Mr. Munoz stressed that United has "lots
of work to do" to win back its employees and customers, after more
than five years of bad blood and bad service plagued the 2010
merger and integration of United Airlines and Continental Airlines.
But Mr. Munoz said the ship is being righted and momentum is
building for the nation's No. 3 carrier by traffic to finish the
integration and build on operational improvements. He said his
highest priority is to reach new combined labor contracts with
9,000 mechanics and 24,000 flight attendants.
About 200 employees, mostly flight attendants and mechanics,
demonstrated outside United headquarters on Wednesday morning to
draw attention to the lack of new contracts. Several of them spoke
at the annual meeting, pressing Mr. Munoz to settle new labor
agreements. "I hear the whistles and screams and shouting
downstairs," the CEO said, pledging his "total commitment" to
market-based compensation for the workers and saying "we've got to
stop this us vs. them."
The company last week unveiled an ambitious makeover of its
international business-class cabins and airport lounges, the first
product refresh in more than a decade. In the industry, "we've been
docile," Mr. Munoz said of United. "We want to be disruptive." He
cited new international routes the company has added, competitive
responses to rivals' attempts to grow in its hub airports and
improvements to United apps.
The CEO, 57 years old, was plucked from the board last September
to lead United after its former chief was ousted. Mr. Munoz weeks
later had a heart attack and in January underwent a
heart-transplant surgery. He only returned to active duty in March,
just in time for the proxy dust-up.
Write to Susan Carey at susan.carey@wsj.com
(END) Dow Jones Newswires
June 08, 2016 13:45 ET (17:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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