Pilots in Aer Lingus nursing paper losses of €34m

PILOTS IN Aer Lingus are nursing paper losses of €34 million as a result of the recent steep decline in the airline’s share price.

This is based on an analysis of share trading by both Irish Airline Pilots Pensions Ltd and Tailwind Nominees Ltd following Ryanair’s offer for Aer Lingus in October 2006 and their shareholdings in advance of the failed bid by Michael O’Leary.

The pilots’ pension fund owns just over 12 million shares, which cost it €35.3 million. This stock is now worth €15.1 million, leaving the pension fund nursing a paper loss of €20.1 million.

Tailwind, meanwhile, owns 9.7 million shares. It paid just over €26 million to build that position and the shares are now worth just €12.2 million. This leaves it with a paper loss of €13.8 million.

These losses are based on Aer Lingus’s closing share price in Dublin yesterday of €1.26. The pilots paid up to €3.04 for their shares.

When contacted, Evan Cullen, president of the Irish Airline Pilots Association and a director of Tailwind, declined to comment.

The pilots have previously stated that they are long-term investors in Aer Lingus.

Accounts just filed for Tailwind show that it made a loss of €5.9 million in the year to the end of September 30th, 2007.

The company is funded by members contributions. About 500 Aer Lingus pilots are members of the scheme, along with 20-30 Ryanair pilots, and cabin crew and middle management at Aer Lingus. Annual contributions range from €10,000 to €60,000 based on service, rank and salaries.