Ryanair's Aer Lingus bid blocked

Ryanair has been notified that the EU Commission intends to reject the low-cost carrier’s attempt to takeover Aer Lingus.

The airline says it will appeal the decision in the European courts, as it is “being held to a much higher standard than any other EU airline” and described the decision as political and unfair. However the European Commission said a final decision had not yet been taken.

Ryanair added it had “met every competition concern raised” by the EU during the process and provided “irrevocable commitments from not one, but two, upfront buyers to eliminate all competitive overlaps” between the airlines, as IAG and Flybe stepped in to take over a number of routes.

The airline’s head of communications Robin Kiely said, “It appears clear from this morning’s meeting, that no matter what remedies Ryanair offered, we were not going to get a fair hearing and were going to be prohibited regardless of competition rules.”

Ryanair, which has indicated that this third bid for Aer Lingus would be its last, said it would launch an appeal in European courts against the decision by the Commission, which acts as the European Union's competition authority.

"This decision is clearly a political one to meet the narrow, vested interests of the Irish government and is not based on competition law," Keily added.

The government, which has said it is against the merger, declined to comment, as did an Aer Lingus spokesman.

Aer Lingus's shares were 5 per cent lower at €1.27 in lunchtime trade, when Ryanair's shares were unchanged at €5.67.

Ryanair, Europe's biggest budget airline, was told last month that it had one last chance to submit measures to ensure the proposed €694 million merger did not reduce competition.

Ryanair's latest offer to the Commission included ceding 43 routes to Flybe and hand to British Airways the routes Aer Lingus operates from London's Gatwick Airport.

The Commission blocked Ryanair's first attempt to take over Aer Lingus in 2007 and Ryanair dropped its second in 2009.

"The Commission will take a decision in this case at the end of February or the beginning of March," said a spokesman for EU competition chief Joaquin Almunia.

Reuters