Irish Government approves sale of Aer Lingus to IAG – What we know

London Air Travel » Aer Lingus

Aer Lingus Airbus A320
Aer Lingus Airbus A320 (By BriYYZ via Wikimedia Commons)

The Irish Government has today announced its support for International Airlines Group’s bid for Aer Lingus.

Full details of the bid can be viewed in the offer document. A more easily digestable summary of IAG’s bid for Aer Lingus can be viewed in this IAG presentation.

The deal is also far from done yet as Ryanair (which holds 30% of the shares in Aer Lingus) has yet to show its hand. The transaction will also be subject to regulatory approval.

Here’s a summary of what we know (and don’t know) so far
Continue reading “Irish Government approves sale of Aer Lingus to IAG – What we know”

IAG outlines plans for Aer Lingus to assuage Government concerns

London Air Travel » Aer Lingus

Since Aer Lingus formally recommended a takeover bid from International Airlines Group (“IAG”) there has been a growing political storm in Ireland amid doubts as to what IAG’s ultimate intentions are for Aer Lingus, specifically with regard to links between the Republic Of Ireland and London Heathrow.

IAG has sought to assuage these concerns by today releasing a statement providing assurances as to connectivity between London Heathrow and Ireland.

Here’s a précis of these assurances.
Continue reading “IAG outlines plans for Aer Lingus to assuage Government concerns”

IAG makes a further takeover bid for Aer Lingus

London Air Travel » Aer Lingus

Aer Lingus Airbus A320
Aer Lingus Airbus A320 (By BriYYZ via Wikimedia Commons)

After much press speculation over the past few weeks, International Airlines Group (parent company of British Airways, Iberia and Vueling) has submitted a further takeover bid for Aer Lingus.

Aer Lingus has formally acknowledged the bid, valued at €2.50 a share with a cash dividend of €0.05 per share.

Aer Lingus say the bid remains conditional on, amongst other things, confirmatory due diligence, the recommendation of the Board of Aer Lingus and the receipt of irrevocable commitments from Ryanair and the Minister for Finance of Ireland to accept the offer.

The key stumbling block to IAG acquiring Aer Lingus will be the Irish Government which holds a 25.1% stake in the airline. The Irish Government will need to be satisfied that links between London Heathrow and Ireland will be maintained and Aer Lingus will not loose its Heathrow slot-holdings.

Here are some thoughts we gathered before Christmas on what may happen of IAG is successful in acquiring Aer Lingus.

Update: Ireland’s RTE is reporting that Aer Lingus may make a statement on Tuesday about the bid.

Update:

Aer Lingus has issued a statement on Tuesday recommending the bid. International Airlines Group has also statement confirming that if the acquisition goes ahead Aer Lingus will maintain its own brand and join the Oneworld alliance and transatlantic joint-venture with BA and American Airlines. IAG will also seek to assuage concerns about the maintenance of links between London Heathrow and Cork and Shannon by entering into discussions with the Irish Government.

What would IAG gain from buying Aer Lingus?

strong>London Air Travel » Aer Lingus

When International Airlines Group (“IAG”) was formed a little under four years ago from the merger of British Airways and Iberia, it stated an ambition to acquire up to 12 additional airlines.

So far it has acquired two. These are bmi and Vueling. bmi has been integrated into British Airways (bmibaby was closed and bmi regional was sold). Vueling continues to operate on a standalone basis.

Today we learned of an approach by IAG to Aer Lingus. IAG confirmed in a statement to the Stock Exchange that it submitted a proposal to make an offer for Aer Lingus, which has been rejected by the Board of Aer Lingus.

Aer Lingus also formally acknowledged the approach, stating that the initial approach was preliminary, highly conditional and non-binding. Furthermore, in their view it under-valued the company.

What would IAG gain from buying Aer Lingus and why is it bidding now?
Continue reading “What would IAG gain from buying Aer Lingus?”