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Ryanair ends Aer Lingus feud by agreeing to sell stake to BA owner Ryanair ends Aer Lingus feud by agreeing to sell stake to BA owner
(34 minutes later)
Ryanair has ended its long-running feud with Aer Lingus by agreeing to sell a stake in its rival Irish airline to the parent of British Airways.Ryanair has ended its long-running feud with Aer Lingus by agreeing to sell a stake in its rival Irish airline to the parent of British Airways.
Ryanair said its board had voted unanimously to accept International Airlines Group’s offer for Ryanair’s 29.8% share of Aer Lingus. Ryanair first bought a stake in Aer Lingus nine years ago and has tried to buy the company on several occasions. Ryanair said its board had voted unanimously to accept International Airlines Group’s offer for Ryanair’s 29.8% share of Aer Lingus. Ryanair first bought a stake in Aer Lingus nine years ago and has tried to buy the company several times.
IAG’s €1.4bn (£1bn) offer looked set to succeed in May when the Irish government agreed to sell its 25% stake in Aer Lingus but Ryanair, whose attempts to buy Aer Lingus were blocked on competition grounds, remained a potential obstacle. IAG’s €1.4bn (£1bn) offer looked set to succeed in May when the Irish government agreed to sell its 25% stake in Aer Lingus but Ryanair, whose attempts to buy the carrier were blocked on competition grounds, remained a potential obstacle.
Related: IAG given clearance by Irish government for Aer Lingus takeoverRelated: IAG given clearance by Irish government for Aer Lingus takeover
Michael O’Leary, Ryanair’s chief executive, said: “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. The price means that Ryanair will make a small profit on its investment in Aer Lingus.”Michael O’Leary, Ryanair’s chief executive, said: “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. The price means that Ryanair will make a small profit on its investment in Aer Lingus.”
In an apparent put-down of IAG’s deal, O’Leary said Ryanair now had no need to buy Aer Lingus because since 2013 his company had established itself at primary European airports. Ryanair had originally wanted to use Aer Lingus’s presence at primary airports to compete for mid-price flights against flag-carrier airlines, he said. In an apparent putdown of IAG’s deal, O’Leary said Ryanair now had no need to buy Aer Lingus because since 2013 his company had established itself at primary European airports. Ryanair had originally wanted to use Aer Lingus’s presence at primary airports to compete for mid-price flights against flag-carrier airlines, he said.
O’Leary said: “We wish IAG well with their takeover of Aer Lingus. When Ryanair first bid for Aer Lingus in late 2006, Ryanair (36 million passengers) carried four times Aer Lingus traffic (9 million). Today Ryanair (over 100 million) carries more than 10 times Aer Lingus traffic (10 million), and we will continue to deliver the vast majority of Ireland’s traffic and tourism growth in the coming months and years.” O’Leary said: “We wish IAG well with their takeover of Aer Lingus. When Ryanair first bid for Aer Lingus in late 2006, Ryanair [36 million passengers] carried four times Aer Lingus’s traffic [9 million]. Today Ryanair [over 100 million] carries more than 10 times Aer Lingus’s traffic [10 million], and we will continue to deliver the vast majority of Ireland’s traffic and tourism growth in the coming months and years.”
The European Union will approve IAG’s takeover of Aer Lingus after IAG made further concessions on competition grounds, Reuters reported. IAG has offered to give up some London airport slots as well as so-called prorate agreements that let airlines carry rivals’ passengers on connecting flights.The European Union will approve IAG’s takeover of Aer Lingus after IAG made further concessions on competition grounds, Reuters reported. IAG has offered to give up some London airport slots as well as so-called prorate agreements that let airlines carry rivals’ passengers on connecting flights.
Willie Walsh, the chairman of IAG, said in May he expected Ryanair to behave rationally and to accept the offer. Ryanair was incensed by the UK competition watchdog’s ruling that it should sell most of its stake in Aer Lingus to leave its rival free to forge alliances.Willie Walsh, the chairman of IAG, said in May he expected Ryanair to behave rationally and to accept the offer. Ryanair was incensed by the UK competition watchdog’s ruling that it should sell most of its stake in Aer Lingus to leave its rival free to forge alliances.