Sir, – In his defence of the privatisation of Aer Lingus by the sale to the UK IAG group, former Aer Lingus chairman Colm Barrington is correct in criticising the then existing dysfunctional shareholding whereby a hostile competitor, Ryanair had a 30 per cent share of the company.
However, he neglects to state that under EU rules, Ryanair had to sell this shareholding and that this sale provided an alternative to the privatisation. The State, which still held 25 per cent of the company, could have expanded its shareholding by buying some of the Ryanair shares.
I suggested this at the time in an Irish Times Opinion article (“It is not too late to change course on Aer Lingus,” June 22nd, 2015).
However, the problem which appeared to be blocking this commercial and sound industrial policy (of retaining a big indigenous company in Irish ownership) was that the Troika (IMF, EU and ECB) had dictated that the government must sell off profitable state companies – ironically, to repay the debts of the private Irish banks.
READ MORE
The programme for that government specified that its agreement with Troika meant that state assets of up to €2 billion had to be sold off. At that time, this figure had already been exceeded by the Fine Gael/Labour government. It was to sell off a total of over €3 billion in public assets.
Thus there was no practical obstacle to the government reinvesting a couple of hundred million in purchasing the Ryanair shares and retaining Aer Lingus in Irish ownership. It was a political decision which lost Ireland control of a big, innovative, indigenous company. – Yours, etc,
PAUL SWEENEY,
Former adviser to the Aer Lingus trade unions,
Millown,
Dublin 6.
