SHARES in Aer Lingus last night remained stubbornly adrift of the latest offer from Ryanair, reflecting a widespread belief that Europe’s largest budget carrier will be blocked from taking over its domestic rival.
Ireland’s former flag carrier saw its shares rise by 18 per cent, compared to the 38 per cent premium on offer from Ryanair. The latter has offered €1.30 per share for the 70 per cent of Aer Lingus that it does not already own, valuing the business at €694 million (£560m).
Aer Lingus told its investors to take no action and added that the offer, “even if it is capable of completion, undervalues Aer Lingus”.
The company, headed by chief executive Christoph Mueller, said the investigation by the UK’s Competition Commission into Ryanair’s existing 29.8 per cent stake in Aer Lingus would prohibit the two from any further integration. British authorities confirmed earlier this week that they would examine whether Ryanair’s minority stake is curbing competition on flights between the UK and Ireland.
It is Ryanair chief executive Michael O’Leary’s third tilt at Aer Lingus since the company’s flotation in 2006, with previous offers of €2.80 and €1.40 failing upon objections from the Irish government and the European Commission.
However, O’Leary pointed out that the market had changed substantially since the last bid attempt in 2008, with a series of deals leading to rapid consolidation within the European sector.
In addition, the Irish government recently announced plans to sell its 25 per cent stake in Aer Lingus as part of an asset disposal programme to repay its bail-out debts in Europe. Abu Dhabi’s Etihad Airlines, which has built up a 3 per cent stake in Aer Lingus, has said it would be interested in buying Dublin’s stake.
Search for a job
Search for a car
Search for a house
Weather for Edinburgh
Friday 24 May 2013
Temperature: 3 C to 12 C
Wind Speed: 18 mph
Wind direction: North east
Temperature: 7 C to 17 C
Wind Speed: 13 mph
Wind direction: West