Ryanair bids £1bn for Aer Lingus

UPDATE: Ryanair has now upped its stake in Aer Lingus to 25%. This gets more and more interesting 😀

http://news.bbc.co.uk/1/hi/business/6194610.stm

So if he did get EI it wont be like what happened to Buzz? Here a ex A320 into FR colours yes its fake looks great on the A320 😀

James

How also would an all Airbus Fleet compare to his all Boeing! I think he would keep long haul and use it perhaps as a tool to help launch FR into the market.

The irish govt have allready said that they wont sell , that leaves to the employes of EI to make up their minds wether they want to sell or not . Personally i doubt that ROL will steal this one although he aint a man that’ll take no for an answer . I bet he has allready thought of some more 737-8’s or 787 to order but i seriously doubt that he’ll be able to pull this one off!

Will EI continue to operate long haul if MOL gets his way?

He said he weill keep them seperate and it now looks like he owns almost 30%.

If Ryanair buys Aer Lingus will MOL keep both them flying or put two into one?

James

Well lads Ryanair as of this morning owned 16% of Aer Lingus and now they own 20%!!!

Oh dear,it seems that there’s nothing anyone can do to stop RYR buying up to 50.1% of the shares,so it seems it will happen.From a statement ot the ryanair site(the pdf file),on the 2nd page it says it will “Give Aer Lingus access to the benefit of ryanair’s lower cost aircraft deliveries & lower cost financing faclities”
Does this mean that they’ll replace the A320/A321’s with 737-800’s?.I hope to god not,i’m sick of seeing 738’s at dublin.The place is swamped with them,not just ryanair but futura,THY & eurocypria have them too!

Aer Lingus were quite right to suggest that £1bn was an undervaluation, however i’m sure MOL knew this prior and was trying his luck. Its my guess this will far from be the final offer we see from FR, considering the commercial benefit over the next few decades with EI on board is significant.

Although it has been stated the two airlines would remain independant, there would definately be synergies which would benefit FR, and i’m certain the US routes would provide a platform on which FR could jut out into the long-haul market as the rumours suggest,

You never know, I could be wrong but I do believe this is a story to watch in the future and another bid is likely,

Wozza

Nooo Ryanair please dont buy EI

Does this mean we could see RYR at Heathrow…..

Probably not..

Aer Lingus would stay separate following takeover: Ryanair
David Kaminski-Morrow, London (05Oct06, 08:56 GMT, 627 words)

Irish budget carrier Ryanair’s extraordinary attempt to take over flag-carrier Aer Lingus centres on a cash offer of €2.80 ($3.56) per share for the airline, which would value Aer Lingus at €1.48 billion.

This offer represents a 27% premium on the €2.20 share price fixed last week for Aer Lingus’ initial public offering, and 12% over yesterday’s closing price for the stock.

Ryanair Holdings has acquired more than 16% of the issued share capital of Aer Lingus, by picking up nearly 85 million shares through a subsidiary called Coinside, and is intending to make an all-cash offer for the remaining shares. It says that its offer is conditional on Ryanair’s obtaining at least a majority stake in the flag-carrier.

“This offer represents a unique opportunity to form one strong airline group for Ireland and for European consumers,” said Michael O’Leary, speaking as he revealed the audacious takeover bid today.

“We will expand, enhance and upgrade the Aer Lingus operations. This offer, if successful, means both companies will continue to operate separately and compete vigorously in the small number of routes on which we both operate – currently around 17 of the approximately 500 routes operated by the two airlines.”

He says that the acquisition price being put forward is an “excellent” offer, arguing that the Irish Government will generate more than €500 million from the sale of its Aer Lingus shares and adding that the airline’s employees will also collectively gain more than €220 million.

“The combined strength of Ryanair and Aer Lingus would establish an Irish airline group with over 50 million passengers annually, capable of competing on the European and world stage against other large European airline groups,” says O’Leary.

If the takeover is successful Ryanair – which will retain the Aer Lingus brand – intends to reduce the flag-carrier’s average short-haul fares, cut its fuel surcharges and trim costs. It says it will retain slots at London Heathrow and all profitable routes operated by the airline.

Ryanair will also give Aer Lingus access to financing benefits to which the budget carrier has access, and upgrade its long-haul fleet. Ryanair claims that Aer Lingus’ long-haul product has “not kept pace with the competition”.

“The board of Ryanair intends to deliver a publicly owned, Irish-managed and -headquartered airline group with the necessary ambition, expertise, financial strength and cost base to take on European and global competitors well into the future,” says Ryanair.

“As an island nation, Ireland is critically dependent upon strong and secure low-fare airline services in order to sustain and develop tourism and economic growth.

“Investing in Aer Lingus is attractive for Ryanair and its shareholders because, among other things, Aer Lingus’ earnings yield is superior to the returns currently available on Ryanair’s cash deposits.

“Ryanair believes that there will be opportunities – by combining the purchasing power of Ryanair and Aer Lingus – to reduce operating costs, to increase efficiencies and to pass on these savings in the form of low fares to the travelling public.”

It claims that Aer Lingus’ short-haul fares are presently “far too high” and that low-fares strategies of Ryanair can be applied to the flag-carrier.

Dublin-based Ryanair has traditionally shunned takeover opportunities, preferring to expand organically, although it made an exception when it picked up budget carrier Buzz three years ago. But O’Leary points outs that the acquisition of Aer Lingus would echo the consolidation being undertaken in other parts of the European airline industry.

“Since we envisage that the two companies would be run separately, in the event that this offer is successful, nothing in this transaction will deflect Ryanair from continuing to focus on its own pan-European expansion or from continuing to deliver unit-cost reductions and continuing to offer lower fares to millions of Ryanair’s European passengers,” adds the budget carrier.

Source: Air Transport Intelligence news

Does this mean we could see RYR at Heathrow…..