Activist: New board would help United CEO succeed

United Airlines activist on the record
United Airlines activist on the record   

After activist hedge funds nominated potential directors for United Continental's board earlier this week, the founder of one of the firms says that move is intended to help its CEO, Oscar Munoz, not hinder him.

"First and foremost, let me say we have tremendous admiration for Oscar. ... We are supportive of Oscar," Brad Gerstner, CEO and founder of Altimeter, told CNBC's "Halftime Report" on Thursday.

"Our first response is not to launch an activist campaign. Some people have called us 'reluctavists,' " he added.

Altimeter and PAR Capital, which have a collective 7.1 percent stake, announced earlier this month that they would be nominating six director candidates to the board. The firms have previously described United's response to shareholder discontent as "knee-jerk," referencing how the airline tapped three new board members and expanded the size of the board after Altimeter and PAR announced their campaign.

"We came to this after talking with the board, expressing our disappointment and really encouraging them to embrace the change that was needed to set this company on the right track. It was only after that we concluded that that wasn't going to happen that we announced our slate," Gerstner said.

Gerstner declined to confirm whether United offered to settle with Altimeter and PAR, saying that he couldn't go into confidential negotiations the firms had had with the airline.

"The fact of the matter is I think everybody who knows us as investors, respects the fact that we're not drawing lines in the sand. We want what's best for United, for its employees, for its customers and for its shareholders," he said.

However Gerstner said that Altimeter and PAR remain disappointed with the board's management of the company given the United's underperformance in the sector. In the last five years, United shares have risen 145 percent, while shares of rivals Delta Air Lines and JetBlue Airways have risen more than 375 and 233 percent, respectively.

"[The board] had plenty of chances over the last five years and the board has failed. It's demonstrated in its earnings, its stock price, its on-time performance," Gerstner explained. Even though the firms like some of the airline's new board members, it isn't enough to satisfy them.

Gordon Bethune on UAL
Gordon Bethune on UAL   

"Two directors out of 15 is simply window dressing. This company needs substantial change on the board in order to have the type of change necessary and the type of expertise necessary to really change the airline," Gerstner said.

Former Continental CEO Gordon Bethune is the top pick of Altimeter and PAR's suggested slate of directors. Bethune told "Squawk on the Street" earlier this month that he is also unhappy with the United's management. He said that the board has a "country club atmosphere," "obviously hasn't been paying attention," and suggested that he thought its members couldn't tell the front of the plane from the back .

Gerstner said that the firms tapped Bethune because of his experience and record of success, but said that his being made chairman is not necessarily an ultimatum.

"We think Gordon would be a terrific chairman of the board, but let's remember how the process works. Gordon was the first to say this is not the Gordon show. He simply wants to do what he can to help Oscar and the board succeed," Gerstner said.

"If he's elected, he'll come in as a director just like our other nominees. Then the board will make a decision as to who the chairman should be."