Airline agrees name deal with EasyJet founder

Stelios, who has also been embroiled in a separate dispute with the low-cost carrier over its business strategy, had threatened to pull the name unless the firm improved its punctuality record at Gatwick Airport.

But EasyJet chief executive Carolyn McCall, the former Guardian Media Group boss who took the helm from Andy Harrison this year, yesterday revealed she had struck a deal to keep the name, which is as integral to the airline as its tangerine orange uniforms.

Under the agreement, Stelios will receive 0.25 per cent of the airline's revenues every year in return for allowing it to use the brand for the next five decades.

The payment will be limited to 3.9 million and 4.95m for the first two years of the agreement. Stelios, who still owns 37 per cent of the company, relinquishes the right to appoint himself as its chairman.

McCall said of the deal: "It is definitely a benefit for us to have that clarity and the freedom to develop our ancillary revenues as we choose … what we've got clarity on is the area of air travel and passenger air travel."

The agreement will have to be put to shareholders at an extraordinary general meeting before the end of the year, but McCall said she was confident of receiving their backing.

"We have already spoken to shareholders over the weekend and they have been very supportive of this. They see it as a good brand licensing agreement for all sides," she said.

But the deal could see EasyJet having to alter the way it markets other services related to its core air travel business, such as car hire and hotels.

McCall said these services were likely to be preceded by the slogan "brought to you by EasyJet" and not the "easy" prefix in future.

Stelios said in a statement: "I am content this is a fair deal for both sides."

The announcement received a positive response from the market, with EasyJet shares nudging up 2.7p to 454.3p.

Stelios is also pursuing the Edinburgh-based online dating firm EasyDate amid claims of alleged trademark infringement.

Last month, it emerged that the company had been threatened with legal action by Stelios' EasyGroup, with the latter claiming that the Scottish firm was trying to pass itself off as being part of the "easy" brand.

Stelios has warned that unless EasyDate changes its name and stops using the online domain name, he will take "further action to protect the easy name".

Aim-listed EasyDate was set up by Scottish software tycoon Bill Dobbie and his Ukrainian business partner, Max Polyakov, in 2005.

It operates a string of websites including DatetheUK.com, Girlsdateforfree.com and BeNaughty.com.