EU Commission to block Ryanair's bid for Aer Lingus

Ryanair's bid for Aer Lingus is to be blocked by the European Commission, a move which the Irish budget airline claims is based purely in the interests of the Irish government.

Ryanair's bid for Aer Lingus is to be blocked by the European Commission, a move which the Irish budget airline claims is based purely in the interests of the Irish government.

The company released a statement on Tuesday afternoon saying that it had been informed by the Commission at a 'State of Play' meeting that it intends to prohibit the offer.

This is the third attempt at a takeover by Ryanair, which already owns 30% of Aer Lingus. Ireland, meanwhile, holds a 25% interest in Aer Lingus and the government has been vocal about worries over competition.

"It appears clear from this morning's meeting, that no matter what remedies Ryanair offered, we were not going to get a fair hearing and were going to be prohibited regardless of competition rules," said Robin Kiely, the Head of Communications at Ryanair.

He said that it would be "manifestly unfair" if the deal was blocked and would contravene EU competition rules, given that the company has addressed every issue raised in the EU's Statement of Objections.

Ryanair said it has eliminated all "competitive overlaps" between itself and Aer Lingus. International Consolidated Airlines Group, otherwise known as IAG, has said that it would take over divestments of Ryanair's and Aer Lingus's entire London-Gatwick operations, and Flybe has committed to take over 43 Aer Lingus UK and European routes.

Kiely said: "Ryanair has no alternative but to appeal any prohibition decision and we expect to get a fair hearing at the European Courts, as we haven't received one from Commissioner Almunia and his case team. This decision is clearly a political one to meet the narrow, vested interests of the Irish government and is not based on competition law."

Shares in Ryanair were down 0.21% at €5.65, while Aer Lingus and Flybe took a greater hit, trading down 4.48% and 11.84%, respectively.

IAG was up 0.22% on the same day it announced that it is to cut 3,800 jobs at its Spanish subsidiary Iberia.

BC

Recommended

The MoneyWeek Podcast: picking stocks is fun, but you need to do your homework
Investment strategy

The MoneyWeek Podcast: picking stocks is fun, but you need to do your homework

John Stepek talks to Steve Clapham, investor, analyst and author of The Smart Money Method, about the dangers in picking individual stocks and why you…
8 Apr 2021
BP looks set to return more money to shareholders as it beats expectations
Energy stocks

BP looks set to return more money to shareholders as it beats expectations

Oil major BP is to embark on a share buyback programme after significantly reducing its debts. Saloni Sardana looks at what it means for your portfoli…
6 Apr 2021
Deliveroo has hit the market – but it’s not getting the warmest welcome
UK stockmarkets

Deliveroo has hit the market – but it’s not getting the warmest welcome

Food delivery company Deliveroo made its debut on the stockmarket this morning. But with the share price sliding by 30% straight away, it’s not made t…
31 Mar 2021
Three stocks to buy now that will come back stronger after Covid-19
Share tips

Three stocks to buy now that will come back stronger after Covid-19

Professional investor Ed Wielechowski of Odyssean Capital, chooses three compelling stocks that should thrive in a post-pandemic world.
29 Mar 2021

Most Popular

“Joke” cryptocurrency dogecoin goes to the moon. What’s going on?
Bitcoin

“Joke” cryptocurrency dogecoin goes to the moon. What’s going on?

Dogecoin – a cryptocurrency created as a joke – has risen by more than 9,000% this year alone. Saloni Sardana looks at how something that began as an …
19 Apr 2021
The FTSE 100 has clawed back above 7,000 – how much higher can it go?
UK stockmarkets

The FTSE 100 has clawed back above 7,000 – how much higher can it go?

The FTSE 100 index has risen to over 7,000 for the first time in over a year – it now sits just above where it was in 1999. But its era of neglect cou…
19 Apr 2021
The bitcoin bubble will burst: here’s how to play it
Bitcoin

The bitcoin bubble will burst: here’s how to play it

The cryptocurrency’s price has soared far beyond its fundamentals, says Matthew Partridge. Here, he looks at how to short bitcoin.
12 Apr 2021