Ryanair bids €1.481 billion for Aer Lingus |
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Published
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Thu, 05 Oct 2006 10:20
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LONDON - Budget airline Ryanair has tendered a bid of €1.481 billion to buy Aer Lingus. Ryanair has offered an all-cash bid of €2.80 per share for its Irish rival.
The group already has a stake of 16 percent in Aer Lingus. It was being speculated that Ryanair would bid, but the company had not made its intentions clear before today. Ryanair said in a statement that the bid offer values Aer Lingus at 27 percent premium over its closing price last week of €2.20 per share. Aer Lingus debuted on the stock market Monday.
"This offer represents a unique opportunity to form one strong airline group for Ireland and for European consumers," said Ryanair's CEO, Michael O'Leary. "The combined strength of Ryanair and Aer Lingus would establish an Irish airline group with over 50m passengers annually, capable of competing on the European and World stage against other large European airline groups."
Mr O'Leary also pledged to enhance the operations of Aer Lingus, besides confirming that Ryanair planned to cut Aer Lingus's average short haul fare by at least 2.5 percent over the next four years. Ryanair will also cull reduce fuel surcharges as oil prices stabilize after the recent turbulence.
The Irish Government has still got a stake of 30 percent in Aer Lingus following its floatation on September 27. Previously it owned 85.1 percent and following the stock market debut, it sold off more than 50 percent of its shares. Aer Lingus workers retained 15 percent of the company.
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