Ryanair to accept IAG takeover bid for its 30 per cent stake in Aer Lingus
10 Jul 2015
Budget carrier Ryanair said today that it would accept a takeover bid for its 29.8 per cent stake in the Irish flag carrier, Aer Lingus, from IAG, the parent company of British Airways, paving the way for a combination that according to analysts would bolster Ireland's position as a hub for trans-Atlantic travel.
Acceptance of the offer from International Consolidated Airlines Group, or IAG., signalled an end some deft corporate manoeuvering by Ryanair, which is based in Dublin, , and Aer Lingus.
The past decade had seen Europe's largest discount carrier, Dublin-based Ryanair, make three unsuccessful offers for Aer Lingus, aimed at expanding into the full-service air travel market and acquiring lucrative takeoff and landing slots at major European airports like Heathrow in London.
''We believe the IAG. offer for Aer Lingus is a reasonable one in the current market and we plan to accept it, in the best interests of Ryanair shareholders,'' Michael O'Leary, the Ryanair chief executive, said in a statement.
He added, the company would vote to accept the offer at a 16 July meeting of Aer Lingus shareholders.
IAG, which is also the owner of Spanish full-service airline Iberia and low-cost carrier Vueling Airlines, pitched a sweetened offer in February for Aer Lingus, after two earlier bids were rejected late last year.
That offer, at €2.55 a share, valued Aer Lingus at about €1.36 billion, or about $1.5 billion.
European Union approval for the deal was now the last remaining hurdle to IAG's plan to acquire Aer Lingus and set up a new transatlantic hub at Dublin airport.
IAG's bid for Aer Lingus had been conditional on agreement from Europe's biggest budget airline Ryanair, which held a 30 per cent stake in Aer Lingus.
In its statement Ryanair said it planned to vote in favour of the IAG offer but its vote was subject to the offer being approved by the European competition authorities.