Access routes ‘a priority’ in Aer Lingus sale decision

Access in and out of Ireland and jobs will be a priority in any decision by the Government on backing a proposed takeover of Aer Lingus, Transport Minister Paschal Donohoe has insisted.

The Cabinet will today discuss the takeover offer from International Airlines Group (IAG), the parent company of British Airways, but the process could take weeks or even months to be decided.

Coalition sources say many hurdles will have to be overcome before a decision is made on the bid which the board of Aer Lingus is considering.

The Government has 25% of the shares in the airline.

While it cannot block the bid, its backing is important and is likely to depend on what guarantees can be made about specific routes, particularly in regional areas, and the large numbers employed in the airline.

The Government and Ryanair, which has a 30% stake in Aer Lingus, are the airline’s biggest shareholders.

Mr Donohoe said Aer Lingus was evaluating the bid and it was a matter for their board. “Employment, both in terms of people working in the airline and the impact that connectivity has on other employment within our economy, are obviously all matters that are extremely important.”

He said he would brief the Cabinet today, but no decision would be made.

Another key issue of concern is how the bid might affect Aer Lingus connections to London and its 23 coveted Heathrow slots.

In a statement to the stock exchange yesterday, Aer Lingus said it had received an offer of €2.55 per share and that its board was considering the proposal.

This is the third bid for the airline by IAG, headed up by former Aer Lingus CEO Willie Walsh. The bid values Aer Lingus at around €1.3 bn. Any deal would net net the Government over €300m.

Opposition TDs warned against the bid, saying it could see regional routes in Shannon and Cork and elsewhere reduced. Fianna Fáil also say assurances on the Heathrow slots would be non-binding and could be rolled back over time.

Cork business leaders have warned any threat to the Cork-Heathrow slots could have a severe impact on business in the south and for future development in the region.

Trade unions Siptu and Impact have also said they are concerned for the security of jobs at the airline.

The Government say the bid could be examined by consultants and that officials in Brussels would also have to approve any offer that is accepted by shareholders.

This could take a number of months to be concluded.


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