The budget airline carrier has been thrown into disarray after its founder, Sir Stelios Haji-Ioannou, worried about the board's strategy, increased his personal stake in the business and threatened to reinstall himself as chairman.

According to the board, Stelios is concerned that the firm is not being cautious enough in the economic downturn. He wants the airline to use its cash to pay dividends rather than investing in new planes or swooping on airlines in crisis.

The row erupted late on Thursday night when Stelios, having left an amicable board meeting in which it was agreed they would discuss his concerns, fired off an unexpected e-mail threatening to oust chairman Sir Colin Chandler and appoint himself to the role if the board does not accept two new directors appointed by him.

The move sent easyJet's share price spiralling down 13½p to 266p, valuing the carrier at just under £1.2bn. The shares have more than halved in price since the start of the year, a paper loss of about £170m for Stelios. Over the past six months its shares are down just 3% as it continues to outperform rivals.

Andrew Harrison, easyJet's chief executive, is likely to face a barrage of questions surrounding the boardroom standoff on Tuesday when he unveils pre-tax profits for the year to September 30 of £115m – little more than half of last year's £202m.

He is also likely to be quizzed on the situation with Gatwick Airport. EasyJet is understood to be in talks with Virgin Atlantic to form a consortium with financial institutions and developers to bid for Gatwick, which has been put up for sale by BAA. Any bid is likely to come in at around the £1.8bn mark, significantly below analyst valuations of up to £2.5bn.

This year the group announced plans to reduce flights from Stansted by 12%, cut flights at its weaker bases and reallocate them to higher-value airports such as Gatwick and locations in France and Italy. On the plus side, revenue per seat is up 12% to £46.36, while passenger numbers jumped 16% following the purchase of GB Airways in January.

Relations between the board and Stelios have already become strained. A court case is pending in the new year in which Stelios is seeking to clarify his rights under his Easy branding deal with the airline.

Last night the Greek entrepreneur and Monaco resident was sticking to a line on his website which read: "I am merely applying my rights under the articles of incorporation of the company to protect my investment in easyJet."

But sources close to the board said they were "astonished" by his actions. "It was not what they were expecting," said one source.

EasyJet's chairman, Sir Colin Chandler, said in a statement he supported the management team's current strategy, although the board was discussing the future direction of the company amid the current economic background.

"This appears to be open warfare," said Stephen Furlong, airlines analyst at stockbroker Davy.

Stelios had transferred shares owned by his sister to his holding company easyGroup, increasing his stake to 26.9% from 15.6%. His brother Polys owns a further 11.3% through Polys Holdings.

"On the part of Stelios it smacks of really appalling corporate governance," said one aviation analyst who asked not to be named. "His behaviour here is pretty disgraceful and I think it would be disastrous for easyJet if they were to stop growing and become a dividend-paying cash cow. In their business you either grow or you die, and the major beneficiary if they went down that strategy would be Ryanair."

Stelios, 41, floated easyJet on the stock market in November 2000 but remained chairman until 2002. In 2005 he took on a non-executive director role, which he still holds.