Aer Lingus was judged yesterday to have broken takeover rules for a second time in its efforts to see off a hostile €1.4 billion bid from rival airline Ryanair.
The former State airline's use of a graph showing the valuation of various European airlines based on their expected earnings in 2007 in its defence document circulated to shareholders earlier this month was deemed by the Takeover Panel to be a profit forecast and was therefore unlawful.
Under takeover regulations it is forbidden to release new information during the course of an offer period.
Aer Lingus said last night that it had withdrawn the reference to earnings.
In a statement issued to the Irish Stock Exchange yesterday, Aer Lingus said: "The participating directors confirm it was not their intention that this reference be regarded as a profit forecast and they are therefore withdrawing it.
"The intention of the participating directors in including this reference was only to illustrate that the offer made by Ryanair values Aer Lingus at a significant discount to Ryanair and Aer Lingus' European peer group."
The airline's management has separately been ordered to publish details of its cost-cutting plans for the airline by the end of next week.
The instruction was also issued by the Takeover Panel yesterday. It said the issue of cost-cutting plans had been raised by the airline in a document outlining reason why shareholders should reject the Ryanair offer.
The panel noted the Aer Lingus circular contained the claim that "we are continuing to drive unit cost efficiencies and will write to you with details of our 2007 Process Improvement Programme in due course".
Aer Lingus must now publish details of those plans by December 1st, three days before the Ryanair offer expires.
Clarifications are nothing new in the ongoing Ryanair-Aer Lingus takeover saga. Both companies have been forced to retract or clarify comments made since Ryanair tabled its offer for the former State airline on October 5th.
As recently as last week, Aer Lingus was forced to issue a statement to the stock exchange admitting that its chief executive Dermot Mannion had breached takeover rules by saying that the company's board would not approve any bid for the airline.
This followed an earlier ruling by the takeover panel that Ryanair had breached stock exchange rules when it announced the details of its bid, by saying each Aer Lingus employee would gain €60,000 from the sale of their shares.
The panel said that to include this detail, Ryanair needed to show how it arrived at the figures.
The ongoing analysis of the comments made by both parties comes as the bid is largely expected to fail.
Despite reporting only marginal support for its offer, Ryanair failed to raise the offer price from €2.80 a share when it extended the deadline for acceptances.
In addition, some 97 per cent of the members of the Employee Share Ownership Trust (Esot) voted against the bid, according to results of a ballot announced earlier this week. Ryanair chief executive Michael O'Leary is on record as stating that he would need the support of the Esot for the bid to succeed.
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