As a result, I generally do not look to the Stock Exchange reports part of the business pages. However, yesterday a headline caught my eye and it was to the effect that Aer Lingus dips as Ryanair blocked.
We had already heard that the EU intended blocking the proposed merger/take-over between Ryanair and Aer Lingus. Yesterday the news on the markets caught up with the EU decision.
Aer Lingus shares had fallen by 4.3% to €1.28 per share, while Ryanair’s share price had increased by 0.8% to close at €5.71. In recent weeks the Aer Lingus share price had increased on the back of an expectation that Michael O’Leary might just be lucky at taking over Aer Lingus on his third attempt.
The increase in Ryanair price was nothing to write home about but it did suggest some limp sentiment that Ryanair was well out of any dealings, let alone a merger with Aer Lingus.
On the other hand the market saw possible value in Aer Lingus shares if Ryanair took over. Of course, it could just be that buyers came into the market in the intention of selling on to Ryanair if and when the EU approved the takeover.
They surely did not take into account the fact that the Aer Lingus board, the Government and the unions were all against a takeover and Government had said that it would not sell its shares to Ryanair.
Equally they did not take into account the clear opposition that appeared to exist from Brussels over such a takeover.
We should not forget that O’Leary has not done much to endear himself to Europe or to our own politicians.
Of course, it could just be that the proposal just did not stand up to the same careful scrutiny that has been used on other European airline mergers such as British Airways and Iberia and the subsequent purchase by International Airline Group (owner of BA and Iberia) of BMI or the merger between KLM and Air France.
So where does it go from here? Ryanair or maybe it was Michael O’Leary doing a solo run had already tried and failed twice. Perhaps he thought that he might just be third time lucky.
After all, this time he was bending over backwards to meet ever growing demands from the EU regulators. Ryanair proposed giving up a large number of slots in Heathrow, giving up routes to quite a lot of airports, paying €100m to FlyBe to take on other routes and generally doing what they thought the EU was asking for. In the demands that were put on it, Ryanair argues that it was being held to a higher standard than the other airlines.
To the naked eye it would seem to be that way.
However, one can only guess Ryanair’s motivation in pursuing an impossible dream when everywhere he turned a big un-scalable brick wall appears? One can only wonder why O’Leary wanted to take on Aer Lingus legacy problems such as its pension fund. A lot of things make little sense.
To some of us, fans and foes of Ryanair alike, the EU is not consistent, it is not democratic, it is not fair, it is biased and it does not deliver on its stated objectives. Ireland being gouged by the ECB by being forced to back the debts of incompetent gamblers is a case in point. Allowing our Government to continue with anachronisms like VRT instead of harmonising car prices is another. There are a myriad of areas where the rules do not appear to be even-handed.
For Ryanair it is time to give up on buying Aer Lingus. It looks like hell will freeze over before the various vested interests, here and abroad, allow that to happen. It is time to get back to what it is good at. If it really wants to take over Aer Lingus let it do it the old fashioned way.
Take Aer Lingus market share through a better selling proposition but this time with some genuine customer service thrown in.