The spat between Ryanair and Aer Lingus over the latter's non-executive directors' fees reached a new pitch yesterday in advance of a shareholder vote on the issue at tomorrow's annual general meeting.
Ryanair – which owns a 29.8 per cent stake in its smaller rival – is tabling two motions at the AGM calling for major reductions in "bloated fat cat" fees which totalled €700,000 (£606,000) last year, pointing to Aer Lingus's collapsing share price, growing losses and falling traffic.
Michael O'Leary, the famously combative chief executive of Ryanair, wants the fees of Aer Lingus's chairman, Colm Barrington, to be cut from €175,000 to €35,000, and the company's non-executive directors' fees to come down from €45,000 to €17,500.
Yesterday Mr O'Leary sent a blistering letter to Noel Dempsey, the Irish Transport minister, who represents the government's 28.3 per cent stake in Aer Lingus. Mr O'Leary accuses Mr Dempsey of deliberately misunderstanding the nature of the proxy that gives the government a majority vote on Ryanair's AGM motions, and berates his department as "institutionally incompetent" for presiding over "hopeless mismanagement in the Dublin Airport monopoly and Aer Lingus".
"Should you fail to cut these excessive fees, then sadly you will have as little credibility as the board of Aer Lingus, when in the coming months they seek to cut employee costs to reduce Aer Lingus's enormous losses," Mr O'Leary writes. "Perhaps Friday is the last chance for the Minister for Transport to stop talking about cost cuts and actually do something useful in the interests of Aer Lingus's passengers and shareholders."
Aer Lingus says that Ryanair – which has tried twice, unsuccessfully, to take over the company – is not acting in the best interests of the company.
A statement to the Irish stock exchange last week said that the Aer Lingus board had already cut its fees by 20 per cent for the coming year, and even before the reduction the remuneration was in line with comparable public companies in Ireland.Reuse content