Aer Lingus rejects Ryanair bid


Aer Lingus has shot down a surprise bid from Ryanair to seize control, saying its offer is too low.

The former state-owned airline said it was unlikely any buy-out could be completed anyway, considering Michael O'Leary's firm was already being investigated by the UK Competition Commission over its existing 30% share.

Ryanair's fresh offer would value Aer Lingus at 694 million euro (£560 million).

"The Board, having considered the offer with its advisers, believes the offer, even if it is capable of completion, undervalues Aer Lingus," a spokesman said.

He added that Ryanair's two previous failed attempts to take over the airline suggested its newest effort will fall flat too.

"The Board notes that Ryanair's unsolicited offer in 2006 was blocked by the European Commission and was not capable of completion and that Ryanair's second offer, in 2008, was withdrawn," he went on.

"Consequently, there is significant uncertainty that any offer from Ryanair, if made, would be capable of completion."

Aer Lingus also urged shareholders to do nothing following the bid.

Earlier, Taoiseach Enda Kenny said the Government would not be forced into any fire sale of its remaining 25% share in the airline.

The Government has been hoping to sell its stake as a state asset following an agreement with its bailout masters the Troika earlier in the year.

Public expenditure minister Brendan Howlin said money raised from the sale would go towards job creation.

If Ryanair's bid is accepted, its offer of 1.30 euro per share would result in a 175 million euro (£141 million) windfall for the Exchequer.

"In consideration of any such (state) asset being disposed of, the Government will not be forced into any fire sale," Mr Kenny said.

"The Government will use proper and appropriate consideration to the right timing, to the right price and in the best interest of the country and the people."

But he added that the Government could not block or veto a takeover.

Ryanair chief Mr O'Leary hopes to boost Aer Lingus's passenger numbers by 4.5 million to 14 million over the next five years by forming "one strong Irish airline" to compete with major European players.

A previous takeover attempt in 2006 was rejected by regulators but Ryanair said consolidation and the economic downturn had left Aer Lingus "exposed as a small and uncompetitive airline".

Opposition party Fianna Fail has appealed to the Government to use its stake in Aer Lingus to block the buy-out.

Transport spokesman Timmy Dooley said a consolidation of the two airlines would result in reduced competition, increased fares and less choice.

Sinn Fein public expenditure spokeswoman Mary Lou McDonald made a similar plea to the Government to block the sale, saying the airline was of "strategic importance" to the State and was vital to maintain the island's connectivity with the rest of the world.

The Irish Hoteliers Federation also called on the Government to try to prevent the Ryanair takeover.

Federation president Michael Vaughan said even if Mr O'Leary operated both airlines separately, he would still maintain a monopoly which would be damaging.

"As it stands, Ireland has already become overly reliant on Ryanair and Aer Lingus, which between them now account for almost 80% of traffic into and out of Dublin," said Mr Vaughan.

"They are also the dominant players across Ireland's regional airports.

"A takeover of Aer Lingus by Ryanair would only exacerbate the situation and would not be aligned with the interests of the Irish economy."


Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebookA unique anthology of reporting and analysis of a crucial period of history
peopleMathematician John Nash inspired the film Beautiful Mind
Richard Blair is concerned the trenches are falling into disrepair
newsGeorge Orwell's son wants to save war site that inspired book
Life and Style
Audrey Hepburn with Hubert De Givenchy, whose well-cut black tuxedo is a 'timeless look'
fashionIt may be a paradox, but the industry loves it
Arts and Entertainment
The pair in their heyday in 1967
Life and Style
fashionFrom bathing dresses in the twenties to modern bikinis
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Neil Pavier: Management Accountant

£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...

Sheridan Maine: Commercial Accountant

£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...

Laura Norton: Project Accountant

£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...

Day In a Page

Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine