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was blocked by the European Commission and was not capable of completion and that Ryanair's second offer, in 2008, was withdrawn," he went on.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

PA

Suggested Topics
PROMOTED VIDEO
Arts and Entertainment
tv
News
Katie Hopkins appearing on 'This Morning' after she purposefully put on 4 stone.
peopleKatie Hopkins breaks down in tears over weight gain challenge
Life and Style
fashionModel of the moment shoots for first time with catwalk veteran
Life and Style
fashionAngelina Jolie's wedding dressed revealed
Sport
Alexis Sanchez, Radamel Falcao, Diego Costa and Mario Balotelli
footballRadamel Falcao and Diego Costa head record £835m influx
News
i100
News
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
Madame Vastra and Jenny Flint kiss in Doctor Who episode 'Deep Breath'
tv
Arts and Entertainment
Olivia Colman topped the list of the 30 most influential females in broadcasting
tv
Life and Style
techIf those brochure kitchens look a little too perfect to be true, well, that’s probably because they are
Arts and Entertainment
Danish director Lars von Trier
tvEnglish-language series with 'huge' international cast set for 2016
Life and Style
tech
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Executive Assistant/Events Coordinator - Old Street, London

£35000 - £38000 per annum + benefits: Ashdown Group: Executive Assistant/Event...

HR Generalist (standalone) - Tunbridge Wells - £32,000

£30000 - £32000 per annum: Ashdown Group: HR Generalist (standalone) - Tunbrid...

Derivatives Risk Commodities Business Analyst /Market Risk

£600 - £800 per day: Harrington Starr: Derivatives Risk Commodities Business A...

Power & Gas Business Analyst / Subject Matter Expert - Contract

£600 - £800 per day: Harrington Starr: Power & Gas Business Analyst/Subject Ma...

Day In a Page

'I’ll tell you what I would not serve - lamb and potatoes': US ambassador hits out at stodgy British food served at diplomatic dinners

'I’ll tell you what I would not serve - lamb and potatoes'

US ambassador hits out at stodgy British food
Radio Times female powerlist: A 'revolution' in TV gender roles

A 'revolution' in TV gender roles

Inside the Radio Times female powerlist
Endgame: James Frey's literary treasure hunt

James Frey's literary treasure hunt

Riddling trilogy could net you $3m
Fitbit: Because the tingle feels so good

Fitbit: Because the tingle feels so good

What David Sedaris learnt about the world from his fitness tracker
Saudis risk new Muslim division with proposal to move Mohamed’s tomb

Saudis risk new Muslim division with proposal to move Mohamed’s tomb

Second-holiest site in Islam attracts millions of pilgrims each year
Alexander Fury: The designer names to look for at fashion week this season

The big names to look for this fashion week

This week, designers begin to show their spring 2015 collections in New York
Will Self: 'I like Orwell's writing as much as the next talented mediocrity'

'I like Orwell's writing as much as the next talented mediocrity'

Will Self takes aim at Orwell's rules for writing plain English
Meet Afghanistan's middle-class paint-ballers

Meet Afghanistan's middle-class paint-ballers

Toy guns proving a popular diversion in a country flooded with the real thing
Al Pacino wows Venice

Al Pacino wows Venice

Ham among the brilliance as actor premieres two films at festival
Neil Lawson Baker interview: ‘I’ve gained so much from art. It’s only right to give something back’.

Neil Lawson Baker interview

‘I’ve gained so much from art. It’s only right to give something back’.
The other Mugabe who is lining up for the Zimbabwean presidency

The other Mugabe who is lining up for the Zimbabwean presidency

Wife of President Robert Mugabe appears to have her sights set on succeeding her husband
The model of a gadget launch: Cultivate an atmosphere of mystery and excitement to sell stuff people didn't realise they needed

The model for a gadget launch

Cultivate an atmosphere of mystery and excitement to sell stuff people didn't realise they needed
Alice Roberts: She's done pretty well, for a boffin without a beard

She's done pretty well, for a boffin without a beard

Alice Roberts talks about her new book on evolution - and why her early TV work drew flak from (mostly male) colleagues
Get well soon, Joan Rivers - an inspiration, whether she likes it or not

Get well soon, Joan Rivers

She is awful. But she's also wonderful, not in spite of but because of the fact she's forever saying appalling things, argues Ellen E Jones
Doctor Who Into the Dalek review: A classic sci-fi adventure with all the spectacle of a blockbuster

A fresh take on an old foe

Doctor Who Into the Dalek more than compensated for last week's nonsensical offering