Irish government snubs IAG’s £1bn Aer Lingus offer
The Irish government yesterday rejected a bid by British Airways owner International Airlines Group (IAG) for Aer Lingus, saying it was not willing to sell its stake in the airline without further assurances.
The government wants commitments on growth prospects and the safeguarding of jobs, before it considers selling its 25 per cent stake as part of the €1.4bn (£1.03bn) bid.
Willie Walsh, the Irish-born chief executive of IAG, was hoping to buy back the airline he once managed.
The bid had received support from the Aer Lingus board, as well as some lobby groups and politicians.
The Irish transport minister Paschal Donohoe, said: “The information and commitments that have been provided to date do not at present provide a basis on which the government could give an irrevocable commitment to accept an offer to dispose of its shares, should one be made by IAG.”
There were other aspects on which the government sought clarification, including how trans-Atlantic routes would be expanded. There was also opposition from the Irish Labour party and unions.
Meanwhile, the airline yesterday announced it carried a record 11m passengers last year resulting in strong revenue and profit growth at the Irish flag carrier.
Overall revenue at the company increased by nine per cent during 2014 to €1.56bn, with operating profits up by 18 per cent to €72m.
The strong performance was mitigated, however, by one off factors such as the €180.3m settlement to fill the deficit at the Irish Airlines Superannuation Scheme and €9.3m in staff stabilisation payments, leading to a pre-tax loss of €111.5m.