Budget airline Ryanair has offered to sell its 29.8 per cent stake in fellow Irish carrier Aer Lingus in a bid to allay regulator’s concerns that the holding is hampering competition.
The group has made three attempts to buy Aer Lingus and chief executive Michael O’Leary recently attacked a “bizarre and manifestly wrong” provisional ruling from the Competition Commission (CC) that its existing stake could reduce competition on routes between Ireland and the UK.
Ryanair, which is seeking to grab 20 per cent of Europe’s short-haul market within the next five years, said yesterday it wanted to dispel the CC’s “unfounded” concerns by pledging to sell its shares in Aer Lingus to any other European Union (EU) airline that makes an offer for the firm and gets the backing of 50.1 per cent of shareholders.
Head of communications Robin Kiely said the move was part of Ryanair’s ongoing remedies discussions with the CC, which has investigated concerns that Ryanair’s stake in Aer Lingus may allow it to influence policy decisions. He added: “This remedy unconditionally removes any ability by Ryanair to block any future takeover of Aer Lingus by another EU airline.”
However, analysts said the move did not necessarily mean Ryanair was ready to give up its shareholding. Donal O’Neill, at Goodbody Stockbrokers, said: “This changes nothing as there are no obvious buyers.”
Ryanair was forced to admit defeat earlier this year following its third takeover bid for Aer Lingus. It had been notified at the time by the European Commission that its €694 million (£597m) buyout plan would be rejected.
The Dublin-based carrier accused European chiefs of holding it to much-higher standards than any other EU airline, claiming it would never get a fair hearing for a potential buyout regardless of competition rules.
The CC is due to rule on a possible forced sale of the stake – which Ryanair has held for six and a half years – in September, having extended the timetable for its investigation from a previous deadline of 11 July.