Irish Government rejects Ryanair bid for Aer Lingus shares

London
Source:
This story is sourced from Pro
See more Pro news »

Ireland's Government has rejected budget carrier Ryanair's takeover offer for Aer Lingus, arguing that the €1.40-per-share bid undervalues the flag-carrier.

The Government holds a 25.12% share in Aer Lingus and surrendering the stake would have given Ryanair over 50% of the airline.

Transport minister Noel Dempsey says the Government feels the offer "greatly undervalues" Aer Lingus, but adds: "There were a number of other issues considered by Government in coming to this decision.

"Competition was a major consideration. A monopoly in this area would not be in the best interests of Irish consumers."

Dempsey says Ryanair's offer did not include any proposed remedies to resolve these competition concerns. The Government also considered the impact of a merger on airport policy and connectivity to Ireland.

Ryanair says it is "disappointed" but that it will "respect and abide by" the decision, which essentially ends the takeover bid in its current form.

Chief executive Michael O'Leary says: "We don't think [the decision] is in the best interests of Aer Lingus, which will be isolated as a small, peripheral, loss-making airline."