FastJet ready to sue Sir Stelios Haji-Ioannou after he warns it is at risk of going bust

African budget airline FastJet could sue its second-biggest shareholder, Sir Stelios Haji-Ioannou, after he said the company was at risk of going bust.

In an astonishing escalation of the row between Haji-Ioannou and FastJet, the airline said it was “taking legal advice” after the businessman published a letter saying he was concerned about the risk of an “insolvency event” at the business in the months ahead.

The letter was triggered by a profit warning two weeks ago which halved the share price and led to the resignation of chief executive Ed Winter this week.

Sir Stelios, who owns 12.6% of the shares, threatened to pull the licensing agreement it struck with the airline in May 2012 to use the FastJet name.

The shares fell 8.75p or 24% to 27.5p as FastJet responded: “Whilst the board welcomes constructive engagement with all shareholders, it cannot understand why easyGroup, acting as either a 12.6% shareholder or brand owner, has published this particular letter without first raising its concerns with the company.

“The board considers the publication of this letter as wholly inappropriate and is taking legal advice on the matter. The company holds easyGroup responsible for any damage caused to the business by the publication of this letter.”