Irish Government agrees to consider Ryanair’s bid for Aer Lingus takeover
The Irish Government has announced that it would consider Ryanair’s bid to take over their Irish rival , Aer Lingus. They want 50% of it. They also admitted that they would not rule out the sale of their 25% stake and are considering it. Ryanair – which already owns 30% of Aer Lingus – launched their third bit to take over Aer Lingus last week. They offered shareholders 38% premium to the market. This deal would require regulators to drop opposition to a merger and the Irish government to agree the price. The FT reports that Ryanair said, rather pompously this would be ….”clearly beneficial in the context of the current recessionary environment and will make a valuable contribution towards budget spending in such important areas as health and education.” The FT asks “Since when, one might ask, have airlines been advising governments how to raise money for social expenditure?”
Michael O’Leary’s third bid to take over Ireland’s icon airline could work
By HILDA HIGGINS (Irish Central)
The Irish Government announced on Tuesday that it would consider Ryanair’s bid to take over their Irish rival Aer Lingus. They also admitted that they would not rule out the sale of their 25 percent stake.
A spokesperson for the transport minister Leo Varadkar told Reuters: “The government is considering the offer.”
Ryanair launched their third bit to take over the iconic airline Aer Lingus last week. They offered shareholders 38 percent premium to the market. This deal would require regulators to drop opposition to a merger.
Michael O’Leary’s Ryanair, already Europe’s largest budget airline, owns 30 percent of Aer Lingus. Their aim is to secure at least 50 percent of shares.
The Government spokesperson said a decision would be made depending “on what the offer means for route options and air fares from Dublin, what price the government can get for its stake and whether competition authorities will allow the takeover.”
When asked whether the Government would sell their 25 percent stake the spokesperson said they would not rule that out.
Last week when O’Leary’s third bid was made public he said he planned to use the takeover of Aer Lingus to allow Ryanair to be more competitive in Europe.
According to BBC reports he said “Since the European Commission recently approved BA’s takeover of British Midland, and Etihad recently invested in Aer Lingus, and there are reports that it has a ‘strong interest’ to acquire the government’s stake, and since the Irish government has decided to sell this stake, we believe now is the time to focus on the right long-term strategic partner for Aer Lingus.”
See also FT article:
Ryanair seeks uplift from turbulence
By Tony Barber
…… The Irish government, which owns a 25% stake in Aer Lingus, stands to realise €174m if the acquisition goes ahead on Ryanair’s terms at €1.30 a share, plus another €4m from an Aer Lingus dividend.
“This,” Ryanair observed sententiously, “is clearly beneficial in the context of the current recessionary environment and will make a valuable contribution towards budget spending in such important areas as health and education.”
Since when, one might ask, have airlines been advising governments how to raise money for social expenditure?
The statement was a naked attempt to exploit the government’s sense of financial vulnerability after Ireland’s multibillion-euro rescue by its European partners and the International Monetary Fund. Mr O’Leary might as well have put all pretence aside and told the government: “You’re stony broke. I’m in the money. Sell up now.” …….