Ryan Air Bids For Aer Lingus
Monday, December 1st, 2008
Budget airline Ryan Air offered €1.48bn to buy Aer Lingus in 2006, and have now put in another offer at half of that amount. Aer Lingus has now been valued at €748m, nearly eighteen months after the initial bid to takeover. Ryan Air wants to create one single “strong Irish airline group”, and say that the deal would work out well for both companies.
Ryan Air made its first bid for takeover in October 2006, just over two years ago. It was vehemently rejected by its shareholders and the commission blocked the move. Ryan Air already owns almost 30% of Aer Lingus, but will need the support of the Irish government to get control. The government currently own 25% of Aer Lingus, and Ryan Air is trying to convince them that the sale would make a “valuable contribution towards current budget spending in areas such as health and education”.
Aer Lingus was baldy hit by the increase in oil prices earlier this year, and has been forced to cut many jobs due to the decrease of travellers. The chief executive of Ryan Air has said that the cash deal that they are offering would secure the company’s future. As yet, Aer Lingus has refused to comment.