Ryanair bid 'undervalues' us, says Aer Lingus

Ryanair bid 'undervalues' us, says Aer Lingus

Aer Lingus yesterday rejected Ryanair’s third takeover attempt, saying it “undervalues” the airline.

“Aer Lingus shareholders are accordingly advised to take no action in relation to the offer,” the Irish carrier said.

The Dublin-based airline also questioned whether the deal was “capable of completion”, a reference to the regulatory hurdles Ryanair’s offer will face, primarily with the European Commission.

The Commission indicated yesterday any examination of a new Ryanair bid would start from scratch, with no reference to the rejection of Ryanair’s first bid in late 2006.

The Competition Commission in the UK is also investigating Ryanair’s 29.82% holding in Aer Lingus. This means Ryanair is prohibited from undertaking any further integration without the consent of the competition regulator.

Aer Lingus said it had delivered a “significantly improved” operational and financial performance since 2009, which had turned the company into a “robust, profitable airline” and achieved a turnaround in its operating performance of about €130 million since 2009.

It also highlighted that it had more than €1 billion in cash on its balance sheet at the end of March. Ryanair made no comment yesterday on the bid.

Irish prime minister Enda Kenny said the government would have to consider a number of issues, including what was the best deal for the taxpayer and for the business.

He said the government was concerned about the dominance of a combined Ryanair-Aer Lingus entity in the Irish aviation market.

Kenny said the government would make its own decision on the matter and would not “be shoved into a fire sale,” according to the Irish Times.

Irish Hotels Federation president Michael Vaughan said there would be “serious monopoly concerns around air transit into Ireland” if Ryanair were allowed to take control of Aer Lingus.


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