Aer Lingus urges shareholders to reject Ryanair bid

The board of Aer Lingus has urged shareholders to reject Ryanair's bid for the company.

In a statement issued this morning, the board of the airline said the offer of €1.30 per share "fundamentally undervalues" Aer Lingus.

Ryanair's formal takeover bid for the former State carrier values Aer Lingus at €694m.

The airline also said it had received legal advice that the European Commission is likely to prohibit the Ryanair offer on competition grounds.

Meanwhile last night, Transport Minister Leo Varadkar said the Government was not ruling out Ryanair's offer to buy its 25% stake in Aer Lingus.

Ryanair's is open to shareholders for acceptances until 3pm on September 13.

Leo Varadkar, speaking during a teleconference call from Cyprus, said the Government was "certainly not ruling out" the Ryanair bid.

Ryanair currently owns 29.8% of Aer Lingus.