Ecology fund puts Ryanair on its hit list
09 January 2005 By Eamon Quinn Ryanair shares have been targeted by wealthy ecology activists who are planning to set up a $100 million (€76 million) London hedge fund designed to short sell stock in companies they believe are vulnerable to consumer boycotts.
The hedge fund has won the support of Zac Goldsmith, son of the late British corporate raider James Goldsmith, and is being led by Max Keiser, a former Wall Street broker and founder of the Hollywood Stock Exchange. Goldsmith, along with his celebrity sister Jemima, inherited a large slice of the €2 billion family fortune seven years ago.
Ryanair shares have been identified by activist group Karmabanque, which Keiser set up to rate world stocks by the number of activist complaints and their vulnerability to boycotts. The airline was rated as the sixth most vulnerable to a consumer boycott in the world, along with companies such as Coca-Cola, McDonald's, Starbucks and Exxon Mobil, which have traditionally attracted the ire of global ecology activists.
According to Keiser, Ryanair was included in the index after activist groups in Britain launched a campaign for wheelchair access by the airline and because the airline industry does not pay Vat on aviation fuel. The airline was then identified as vulnerable to consumer boycotts because of its huge profitability, he said.
"We are trying to set up $100 million in funds by the end of March which is going to take positions on the most highly rated stocks in the index," said Keiser.
The hedge fund has so far raised $12 million but had rejected a proposal on political grounds by a "big time" Saudi investor to underwrite the planned hedge fund completely, Keiser said.
Goldsmith said he hoped the hedge fund would work by harnessing the "immensely powerful market to force honesty and real-accounting into the share prices of companies".
A spokeswoman for Ryanair said: "Since they put Ryanair on their list, our share price has gone up by 10 per cent. We are always delighted to be part of a list which includes Coca-Cola, Starbucks and Wal-Mart."
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