Government able to discuss IAG offer under rules

Takeover panel rules apply only to the companies involved in the proposed deal

Takeover panel rules do not bar the Government from discussing International Consolidated Airlines Group's (IAG) bid to buy Aer Lingus, as a number of ministers have suggested.

IAG has been discussing its proposal to pay €1.36 billion for Aer Lingus with representatives of the Government, which is responsible for the State's 25.1 per cent stake in the airline.

Government figures, including Minister for Transport, Tourism and Sport Paschal Donohoe and Minister for Finance Michael Noonan, have said that they are limited in what they can say as Aer Lingus is deemed to be in an "offer period" and is subject to rules that govern the takeover of a listed company.

Takeover Panel

However, the rules set by the Irish Takeover Panel, which polices the conduct of these deals, do not apply to shareholders, only to the company making the offer and to the board of the business it is trying to buy.


A specialist in the area confirmed that even if a shareholder has nominated directors to the board of the target company, the rules still do not apply.

The Government has two nominees on the board, Frank O'Connor and Willie Slattery.

However, the Government said that its legal advice is that “any statements that the Minister may make in relation to Aer Lingus are regulated by the Irish Takeover Rules and subject to review of the Irish Takeover Panel, as Aer Lingus is currently in an offer period under the Rules”.

It added that the rules impose a range of obligations on the Minister for Finance as a substantial shareholder in Aer Lingus, including confidentiality and to ensure that statements made are accurate.

Meanwhile, the British/ Irish Chamber of Commerce, which represents hundreds of businesses in both countries, has backed the bid, saying it could offer huge traffic growth for Dublin.

“The proposed takeover provides scope to further develop Dublin’s ability to grow as a hub; capitalising on existing strong links to regional airports in the UK and the lack of runway capacity at BA’s Heathrow base,” said the chamber’s vice-president John McGrane.

Barry O'Halloran

Barry O'Halloran

Barry O’Halloran covers energy, construction, insolvency, and gaming and betting, among other areas

Mark Hennessy

Mark Hennessy

Mark Hennessy is Ireland and Britain Editor with The Irish Times