Aer Lingus homing in on preferred TEAM player out of three bidders

Aer Lingus is to meet representatives of TEAM, its aircraft maintenance division, on Tuesday to outline who is the preferred buyer. Three bidders are reportedly in the frame.

These are thought to be FLS Aerospace, the largest independently-owned aircraft maintenance company in Britain, BF Goodrich, a US-based chemicals to aerospace group whose interest was reported to have waned earlier this week, and Allied Signals, a leading global supplier of aircraft landing systems, repair and overhaul services.

Unions and Aer Lingus management representatives met earlier this week and another meeting was scheduled for next Monday. However, this has since been deferred until Tuesday, leading to speculation that difficulties may have arisen.

Yesterday, a spokesman for FLS said the company was aware TEAM was for sale and that TEAM was one of its major competitors. "We are looking at expanding in Europe," the spokesman said.

"The TEAM facility is one of a number of sites which might be of interest to our company."

However, he declined to comment further. An Aer Lingus spokesman also declined to comment.

FLS is Danish owned but has aircraft and repair facilities at Stansted, Manchester and Gatwick. Among its customers are Continental Airlines and British Airways, who ironically are being tipped as a strategic alliance partner for Aer Lingus. It also carries out work for Ryanair.

Once heads of agreement are signed, Aer Lingus will move into more intensive negotiations with the unions. The central issue is the letters of guarantee which around 1,200 of the 1,500 TEAM employees were given when the maintenance facility was set up. This guarantees them employment back in Aer Lingus if anything happened at TEAM.

Because negotiations with possible bidders have been taking place this week, the whole industrial relations issues have been put on the back burner. Aer Lingus has offered to buy out the letters for £25 million, but this is understood to be merely an opening position.

One option would be for Aer Lingus to indemnify an incoming investor against all claims by the employees, but it is understood that Aer Lingus would like the issue resolved before a buyer takes over. Various industry sources have valued the TEAM facility at £25 million-£30 million. Although the company has had its share of troubles, it is due to make a small profit by 1999 and has a highly-skilled workforce.