Ryanair hopes concessions will allow takeover of Aer Lingus
RYANAIR HAS held out fresh concessions to win approval to take over Aer Lingus, offering to move some of its rival’s aircraft to continental Europe to operate non-Irish routes and allay concerns about a near monopoly in the domestic market.
Europe’s biggest budget carrier said it would also scrap some of its own routes from Ireland to persuade anti-monopoly regulators to reverse course after rejecting an earlier merger. The European Commission is to rule by January on Ryanair’s €700 million bid, seen as a long shot by analysts and investors, who point to Aer Lingus’s shares trading well below the bid price.
Ryanair had an initial bid turned down by the commission in 2007 and dropped a second offer in 2009. Ryanair, which already owns 30 per cent of Aer Lingus, has offered €1.30 a share for the remaining stock, which traded yesterday at €1.09.
Ryanair has said it will submit a remedies package that will include commitments by rival airlines to operate some of the 36 routes on which it and Aer Lingus have no competitors.
“The way we can get across the line is by cutting a certain number of Aer Lingus routes, cutting a certain amount of Ryanair routes and then maybe refocus Aer Lingus,” Ryanair spokesman Stephen McNamara told a news conference.
Of Aer Lingus, he said: “Instead of having a Belfast base and a Gatwick base, they should have a Brussels base” to serve non-Irish routes.
Aer Lingus, which only operates from Ireland, could then compete with Brussels Airlines out of Brussels National airport and possibly with EasyJet in destinations such as Amsterdam.
Ryanair has spoken to about 10 airlines and charter operators, including Virgin, British Airways and CityJet, about taking over routes, Mr McNamara said. Ryanair chief executive Michael O’Leary met Willie Walsh, the head of British Airways’s parent IAG, during the past three months to discuss the remedies package, he added.