Aer Lingus Rejects Ryanair Takeover Bid

by Robin Pilgrim, LawAndTax-News.com, London

26 October 2006

Following the rejection by Aer Lingus of Ryanair's takeover bid and the announcement that the former airline's pilots are attempting to build up their stake in the company in order to thwart the budget airline's plans, it is seeming less and less likely that the deal will go ahead.

In a statement released on Monday, Aer Lingus announced that:

"The Board of Aer Lingus, which has already rejected the Offer, will formally respond in detail when it issues its response setting out the views of the Participating Directors on the Offer within the next fourteen days. In the meantime, Aer Lingus shareholders are strongly urged to take no action in relation to the Offer."

Commenting on the offer, Aer Lingus Chairman, John Sharman, observed that:

“The Offer from Ryanair is without merit. It fails to recognise the unique position of the Group's businesses, its outstanding track record and its excellent growth prospects. The Offer also ignores the significant regulatory issues that a combination would face. A takeover by Ryanair, no matter how it is dressed up, would be bad for Aer Lingus, for its shareholders, for its employees and for consumers."

Meanwhile, reports in the national media revealed this week that Aer Lingus pilots have invested substantial sums in the company's shares, amassing a combined stake in the region of 1.2% of the airline.

It is thought that shareholders opposed to the hostile bid now hold around a 46% share of the company.

Recommended