Aer Lingus selects advisers on proposed privatisation

State-owned airline Aer Lingus has selected Merrion Capital and Goldman Sachs as advisers to the company on its proposed privatisation.

With the Government advisers UBS and AIB said to be working to an "aggressive timetable", the groups were hired yesterday after presentations in London and Dublin last week.

Merrion overcame opposition from a number of other domestic groups to win the contract. Goldman missed out on the contract to advise the Government on the international aspects of the sale, despite preparing the report for Minister for Transport Martin Cullen that led to a decision in principle from the Cabinet to privatise the airline.

The appointments were made as new Aer Lingus chief executive Dermot Mannion and his team proceeded with the preparation of a business plan that is likely to concentrate on the development of new long-haul routes as the engine of growth.

A rough outline of the plan should be ready by early December and Mr Mannion said discussions on them were entering "a critical phase".

But as preparations intensify for a possible sale next year, there is some doubt about the willingness of Taoiseach Bertie Ahern to go down that road in advance of the next general election. Informed sources said Aer Lingus was pushing for a sale in the second half of next year, although some in Government circles believe it should be done before June.

The alternative is postponement until after the election, which must take place by the middle of May 2007.

Crucial issues for resolution in the business plan include the terms of the airline's commercial relationship with the Dublin airport authority, staffing structures on long-haul flights, and the management of the airline's relations with the worker-controlled trust that owns 14.9 per cent of Aer Lingus.