Aer Lingus Says Ryanair's Stake Not For Long-Haul

October 20, 2011

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Aer Lingus criticised Ryanair's attempts to call an extraordinary general meeting (EGM) of Aer Lingus shareholders and said on Thursday its rival's 29 percent stake in the airline should not be maintained in the long run.

The two Dublin-based airlines have been locked in a bitter war of words for months over Aer Lingus' large pension deficit and the absence of a dividend payment by Aer Lingus.

"We believe that the context in which you frame your proposals is a continuing attempt to de-focus and distract management with consequent potential implications for performance and, as such, are not in the best interests of all shareholders," Aer Lingus chairman Colin Barrington said in a letter to Ryanair chief executive Michael O'Leary published on Thursday.

Ryanair has twice had attempts to take over Aer Lingus rebuffed on competition grounds and Barrington said Ryanair should sell its stake, which is valued at around EUR€113 million (USD$154.8 million).

"It is our view that the shareholding cannot be maintained in the long term," he said.

Ryanair has said it would consider selling its stake if the government sells its 25 percent shareholding. Dublin is considering putting its shares on the block as part of an EU-IMF privatisation programme.