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Aer Lingus to launch a new short-haul premium product “Aer Space”

Aer Lingus London Heathrow (Image Credit: Heathrow)

Aer Lingus confirmed during the announcement of its half year results yesterday, Wednesday 29 July 2015, that it is to effectively re-introduce business class on selected short-haul routes, in the fourth quarter of this year.

The new “Aer Space” product will offer full ticket flexibility, lounge access, priority boarding and luggage handling and complimentary food & drink (we don’t know if this includes hot food or alcoholic drinks).

The seat itself will be the same as economy but the middle seat will be kept free.

There will also be no cabin divider between economy and “Aer Space” (this is so it doesn’t constitute a separate cabin for Air Passenger Duty purposes).

It is very similar to the “Excellence Fare” offered by Vueling and Germanwing’s “Best Fare”.

The routes on which it will be launched have yet to be announced but we expect that London Heathrow – Dublin will be one of the first.

We assume that passengers connecting to/from business class long-haul flights on Aer Lingus and its future IAG/Oneworld partners will be seated in the “Aer Space” seats.

Update:

This product has not, as of April 2018, not been implemented and seems to have been postponed indefinitely.

IAG’s bid for Aer Lingus looks certain to go ahead. What do we know now?

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Aer Lingus Airbus A320 (By BriYYZ via Wikimedia Commons)

Following the news that the Irish Government has given its support for International Airlines Group’s bid for Aer Lingus and that Ryanair (which holds 30% of the shares in the airline) has also agreed to sell its stake, this means that, barring any last minute complications, it is now a near certainty that the bid will go ahead.

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.

Here’s a summary of what we know (and don’t know) and what we expect to happen when Aer Lingus joins IAG:
Continue reading “IAG’s bid for Aer Lingus looks certain to go ahead. What do we know now?”

Irish Government approves sale of Aer Lingus to International Airlines Group – What we now know & don’t know

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.

IAG is due to hold a conference call for analysts tomorrow (Wednesday) morning. 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 International Airlines Group – What we now know & don’t know”

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

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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

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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

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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?

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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?

Aer Lingus is the fourth largest airline at London Heathrow with 3.1% of the airport’s departure and arrival slots. Acquiring Aer Lingus would give IAG member airlines nearly 56% of departure and arrival slots.