Cawley still bullish despite O'Brien's block buy

Ryanair is confident its planned takeover of Aer Lingus can still go ahead, despite parties opposed to the bid increasing their stake in the former State airline. Claire Shoesmith reports.

Announcing two new routes from Dublin, deputy chief executive Michael Cawley yesterday said that the €1.4 billion bid for Aer Lingus was generous and one that the current shareholders should consider seriously.

"It's incumbent on all shareholders to consider this offer seriously and what will happen should the offer fail," he said.

His comments were directed particularly towards the Aer Lingus Employee Share Ownership Trust (Esot), which has yet to stake its position in relation to the bid.

The shares are currently trading above Ryanair's offer price of €2.80 a share, but did lose some of their ground earlier in the week after businessman Denis O'Brien took a 2.1 per cent stake in the group and the Aer Lingus pilots added to their holding.

About 45 per cent of the shares are held by parties, including the Government, that oppose the bid.

Even if the bid is not successful, Ryanair intends to hang on to (or increase) its 19 per cent stake, according to Mr Cawley. "There is no question it is a good economic investment for us," he told reporters.

"No question but that we have a long-term interest in maintaining a shareholding and increasing it over time."

He said that at the current time the company had "absolutely" no plans to raise the bid, reiterating that he believed it to be a generous offer.

However, the company later released a statement, saying that while it had not at this time considered raising the offer, it could not rule out making a higher bid in the future.

Ryanair meanwhile has announced the addition of two new routes from Dublin, to Stockholm and Warsaw.

They will start operating in February and bring to 20 the number of new routes announced by the airline from Dublin in recent weeks.

It also announced the expansion of its online check-in and priority boarding service starting from November for a cost of between €2 and €3.