Ryanair will appeal if ordered to dilute Aer Lingus holding

Ryanair chief Michael O’Leary does not expect that the airline will have to sell any of its near 30% stake in Aer Lingus when Britain’s Competition Commission rules on its findings next month.

Speaking yesterday after a company EGM to rule on Ryanair’s latest aircraft order, Mr O’Leary said the airline’s shareholders remain happy with the company’s strategy and are as puzzled by the threat on the Aer Lingus stake as much as Ryanair’s management.

Last month, Britain’s Competition Commission claimed that Ryanair’s shareholding in Aer Lingus allowed it to influence commercial policy and strategy.

Additionally, the Commission — which is set to make a final decision on its findings in July — said that Ryanair’s 29.8% holding was likely to weaken Aer Lingus’s position on routes between Ireland and Britain; and could allow Ryanair to block special resolutions proposed by Aer Lingus and the latter’s ability to merge with another airline in order to become more competitive.

Already quoted as saying the provisional findings were “bizarre and manifestly wrong”, Mr O’Leary poured more cold water on the matter yesterday, by alluding to incompetent bureaucracy.

He said Ryanair will appeal the decision if the Commission rules it should dilute its Aer Lingus shareholding; and even suggested Aer Lingus would do likewise if it was ruled that Ryanair shouldn’t have to reduce its holding.

Shareholders yesterday voted 100% in favour of Ryanair’s plan to buy 175 Boeing 737-800 aeroplanes over the next five years.

The unanimous approval makes the airline’s purchase deal — tentatively agreed upon three months ago — binding.

Ryanair’s CEO said the deal will significantly reward shareholders, with bigger aircraft and lower costs per seats resulting in increased shareholder returns.

He also said that the purchase is necessary to keep Ryanair growing — with another 200 routes planned — and will create another 3,500 jobs in the coming years.

He also described as “excellent” current trading levels at the company and noted that recent strike action by air traffic controllers in France had only had a relatively small impact on operations.

Separately yesterday, Ryanair published its up-to-date customer service stats, for the month of May.

These showed a record percentage of the airline’s flights — 94% in total — arriving on time, with less than one complaint for every 2,000 passengers being logged.