Ryanair’s bid to buy Aer Lingus has been rejected by the Irish government on grounds that the deal would adversely affect competition. The decision on Aer Lingus-Ryanair deal will be taken early next year after European Commission (EC) completes its probe on the €694 million (£566 million) bid.
Responding to the Irish government’s decision to oppose the bid, Ryanair said that the Irish government had no power to block its bid as it already owns 30% stake in Aer Lingus. Ryanair has already made three attempts to fully acquire Aer Lingus, which failed miserably. Ryanair’s first bid was turned down by the European Commission in 2007. The second attempt was made in 2009.
Ryanair claims to have offered ‘unprecedented remedial packages’, which included selling off some Aer Lingus’ slots at London’s Heathrow airport to British Airways. Last month, the European Commission issued a list of objections to Ryanair, to which Ryanair responded by stating that it would offer new concessions to Brussels, which included selling off these slots.
British Airways has confirmed that it has entered into a non-binding memorandum of understanding with Ryanair which is subject to EC approval as part of the review of the Ryanair-Aer Lingus deal.
But Irish Transport Minister Leo Varadkar said, “The Ryanair offer and at least the remedies that are being reported are not sufficient in our view, so we won’t support their bid and, in addition, won’t co-operate with their remedies package. The Commission will make its own decision, but we have given our views and they are around connectivity, competition and employment.”