Ryanair initiates moves to limit UK shareholder base

Ryanair has amended the terms of a €700m share buyback programme to allow block repurchases it says could limit the holdings of British shareholders and ensure that it remains majority EU-owned after Brexit.

Ryanair triggered contingency plans in March to restrict the voting rights of British shareholders if the UK leaves the EU without a deal on future relations or quits both the EU customs union and single market in a hard-Brexit scenario.

The restrictions are aimed at ensuring Europe’s largest low-cost carrier remains majority EU-owned to comply with its licensing and flight rights.

“Ryanair advises that it is amending the terms of the arrangements to allow for shares to be repurchased by way of block trades from EU holders of shares,” the airline said.

Any such block repurchases from UK holders will, in the event of a no-deal or hard Brexit, limit the proportionate number of shares held by or on behalf of non-EU shareholders and should, therefore, reduce the period that the resolutions announced on March 11 would need to remain in place

Ryanair’s chief financial officer Neil Sorohan said in February that while the airline was 55% EU-owned, UK-based shareholders controlled 20% of its stock. He said he expected half of those to redomicile to the EU after a no-deal or hard Brexit.

Ryanair announced the €700m buyback last month, guiding that it expected to split it between €500m of shares in underlying American Depositary Shares (ADS) and €200m of ordinary shares, but that the board had discretion to revise this allocation. The programme is due to take nine to 12 months.

Reuters