Ryanair submits formal bid for Aer Lingus for EUR694m
Ryanair submitted (17-Jul-2012) a formal bid to take over Aer Lingus for EUR694 million. Ryanair currently holds a 29.8% stake in the Irish national carrier and plans to purchase the remaining stock for EUR1.30 per share, a 38% premium on the stock value on 19-Jun-2012, the day prior to Ryanair's initial announcement it would seek to take over the airline. Shareholders would also receive a dividend of EUR0.03 per share which was announced by Aer Lingus on 04-May-2012, on 31-Jul-2012. Ryanair CEO Michael O'Leary said if its takeover of Aer Lingus is approved, it will increase Aer Lingus' total annual passenger traffic from 9.5 million currently to 14 million in five years. Mr O'Leary believes the LCC's bid "represents a significant opportunity to combine Aer Lingus with Ryanair, to form one strong Irish airline group capable of competing with Europe's other major airline groups". Mr O'Leary also said Ryanair will "help Aer Lingus to increase the productivity of its staff through a mixture of efficiency increases and growth". Ryanair is seeking acceptance of the bid by 13-Sep-2012 and is hopeful it will be approved considering the other recent mergers of European carriers. Irish Transport Minister Leo Varadkar said the Irish Government will take into account four factors when it considers the bid, including what is best for passengers regarding connectivity and fares, what is best for taxpayers regarding the price the Government can get for its 25% stake, what is best for the Irish economy overall and the views of regulatory authorities. Ryanair previously attempted to take over Aer Lingus in 2007 but was blocked by the European Commission due to competition issues. Ryanair's existing 29.8% stake in Aer Lingus is under investigation by the UK Competition Commission. Meanwhile the Irish Exporters Association called for the Irish Government to withdraw the sale of its stake in Aer Lingus over fears potential buyers of the stake will not provide the same reliable air cargo services to the US as Aer Lingus has. [more - original PR - Ryanair] [more - original PR - Ryanair II]