Aer Lingus takeover talks ‘will take weeks’
Amid growing opposition to any sell-off of the state’s 25% shareholding in the airline, Taoiseach Enda Kenny said key issues being considered included connectivity and competition.
While the Government itself alone cannot veto any takeover by the British Airways company, it will now use consultants and an inter-department group to evaluate the bid.
“The discussions now under way will continue for some time. So the offer is not yet formal and, if you like, Aer Lingus is now in a position where there’s an offer period to be reflected upon,” Mr Kenny told the Dail.
Fianna Fáil leader Micheál Martin warned that any sell-off would have bad economic consequences, not just for Dublin, but also Cork, Knock and the Shannon region, as well as the country as a whole.
Mr Martin said there were genuine concerns that up to 1,200 jobs could be at risk at the airline if the sale was agreed.
The Cabinet discussed the proposed €1.3bn IAG bid yesterday, which would potentially land a €300m windfall for the Government shares. But no decision was taken.
Instead, legal and financial experts will advise an inter-departmental group which will look at the issues involved in any takeover.
Important landing slots that link Cork, Shannon, Knock and other regional airports as well as the security of jobs at the airline will be central to the scoping exercise.
Aer Lingus’s board yesterday said that it would be recommending the takeover to its shareholders, who also include Ryanair as well as the Government.
IAG, led by former Aer Lingus CEO Willie Walsh, said that it would engage with the Government over its bid.
It said the airline would continue to operate as a separate business within the group and that Ireland would still hold onto its air links with key nations for investment and tourism.
Crucially, IAG said that it recognised the importance of direct services and air route connectivity for Ireland.
The approval of the Dáil is needed for the Government to sell its stake.
However, a number of Labour TDs have expressed reluctance to support any takeover.
Dublin North TD, in a statement last night, said he was against the state selling its share as the “risks inherent for our connectivity, tourist numbers and workers conditions” were too much.
“I would find it difficult to accept any guarantees given from IAG about safeguards for slots or staff,” he said.
TDs Ciarán Lynch and Michael McCarthy also said that flights in and out of their home city of Cork needed to be protected under any deal.
Transport Minister Paschal Donohoe said he had been contacted by TDs with concerns. He said the group made up of his department, others and NewEra (a body which manages the state’s shares in companies) would report back in a number of weeks after evaluating the proposed IAG bid.
