Ryanair said today it would not increase its €2.80 per share takeover offer for Aer Lingus.
Chief executive Michael O'Leary said in a letter to Aer Lingus shareholders: "In our opinion, there is nothing in the Aer Lingus defence document or its strategy as articulated by the chief executive that justifies a price in excess of 2.80 euros.
"Accordingly, Ryanair confirms that it will not increase its offer of €2.80 per Aer Lingus share."
However, it said in an appendix to the letter that it reserved the right to raise the offer, which values Aer Lingus at €1.48 billion, under certain conditions.
Having said it will not increase its bid, Irish takeover regulations dictate that Ryanair may now only sweeten the offer if somebody makes a competing approach or if the Aer Lingus board was to say it was ready to accept an improved offer.
Both scenarios are considered unlikely.
Aer Lingus's share price held above the €2.80 offer price for more than four weeks after the October 5th bid - and at one point rose as high as €3.05 - on expectations Ryanair would have to raise the bid given strong opposition to the takeover.
But the shares have slipped back in the past two weeks amid thin trading. They were steady at €2.74 today.
Ryanair last week extended to December 4th the period for Aer Lingus shareholders to accept its bid.
The first deadline for Aer Lingus investors to accept the offer passed on November 13th, but holders who accepted by that date held less than 0.1 per cent of shares in the airline.
Acceptance had not been expected to be high given opposition from key shareholders such as the Government, which has a 25.3 per cent stake in Aer Lingus.