Ryanair has made a last-ditch effort today to persuade Aer Lingus shareholders to accept its takeover bid by repeating a call for job cuts at the airline and accusing management there of misleading investors.
The Ryanair bid values Ireland's former State airline at €1.48 billion ($1.94 billion) and is expected to fail given opposition from key shareholders such as the government and Aer Lingus employees.
Ryanair chief executive Michael O'Leary said in a letter to Aer Lingus shareholders, who have until December 22nd to accept his €2.80-a-share offer, that the Aer Lingus board could not argue the bid was too low, having floated the company for less.
Ryanair CEO Micheal O'Leary
"The Aer Lingus board may have misled the selling shareholder and ultimately the people of Ireland by agreeing to a price of €2.20 at the IPO," he wrote in the latest move in a two-month long war of words between the two companies.
"Alternatively, they may be misleading shareholders now in recommending you reject the Ryanair offer of €2.80 . . . If €2.80 'significantly undervalues Aer Lingus' then why did this board approve the sale of Aer Lingus' shares at €2.20 just eight days prior to the Ryanair offer?"
Aer Lingus's shares were down 1.1 per cent at €2.72 today, while Ryanair was 0.1 per cent lower at €9.94 in an Irish market that was up 0.2 per cent.
Aer Lingus declined to comment on the letter.
Ryanair has said that if the bid fails - which even Mr O'Leary has said is likely - it will remain a long-term shareholder and may return with another offer.
Mounting expectations that Ryanair's bid for a stake of at least 50.1 per cent will fail means shares in Aer Lingus have traded at below the offer price for more than a month - although Ryanair said that also reflected investors' low expectations of how an independent Aer Lingus would perform.
A circular from Aer Lingus earlier this month lacked concrete proposals on how current management planned to lower fares and costs or generate significant growth, Mr O'Leary claimed.
"With over four times the number of employees per passenger, Ryanair believes that Air Lingus is overstaffed compared to Ryanair. The second circular fails to address the urgent need for a reduction in staff numbers at Aer Lingus."
In response to a request for details from Ireland's Takeover Panel, Aer Lingus said on December 1st it planned to boost revenues and cut costs significantly next year. While it identified areas where overheads could be reduced, it did not specify how or whether there would be any job cuts.