Ryanair Goes To Aer Lingus Shareholders To Accept Bid
Irish airline Ryanair launched its hostile attempt to take over Aer Lingus on Monday by writing to its rival's shareholders, imploring them to accept a 7EUR50 million euro (USD$1.01 billion) bid.
The low-cost carrier, which already owns almost 30 percent of Aer Lingus, said in its newly published offer document that other investors should vote for the creation of a united Irish airline by January 5.
It offered 1.40 euros a share for the former state airline this month, just half the price of a previous offer in 2006 which was blocked by the EU on competition grounds.
The board of Aer Lingus, which has vowed to fight vigorously to defeat the new approach, including by seeking a "white knight" investor, on Monday repeated its opposition.
"This document contains nothing new," Chairman Colm Barrington said. "It is the usual stream of invective, spin and misrepresentation that we expect from the people at Ryanair," he said in a statement.
But Ryanair chief executive Michael O'Leary told reporters that in the absence of any other bidder entering the fray, the group's bid had a "strong prospect of success".
He added that as an Aer Lingus shareholder he would welcome a rival approach, and accused the target company's management of being "hell bent" on selling out to anyone but Ryanair.
Ryanair reiterated its own guidance to break even for the current financial year, amid falling fare prices.
Irish regulators last week blocked sweeteners included in Ryanair's initial proposals saying they could breach takeover rules by favouring one shareholder, namely the government.
But in the offer document Ryanair moved to appease the regulators, saying it would call an extraordinary general meeting to make Aer Lingus's valuable Heathrow slots impossible to sell without a vote from both Irish houses of parliament.
O'Leary said he thought this was likely to satisfy the Takeover Panel.