RSS Feed

Related Articles

Related Categories

Aer Lingus moves to force sale of Ryanair stake

12th October 2007 Print
Aer Lingus has confirmed it is to take legal proceedings to force Ryanair to dispose of its shareholding in Aer Lingus. This follows confirmation by Philip Lowe, the E.U.'s Director General for Competition, that the European Commission is to adopt a decision that the Merger Regulation does not give it the legal authority to force the sale of Ryanair's stake following its prohibition of Ryanair's bid for Aer Lingus.

The Commission's decision will open the way for Aer Lingus to make an appeal to the European Court of First Instance that would, if successful, enable the Commission to order Ryanair to dispose of its stake in its main competitor. It is Aer Lingus' view that the Regulation does give the Commission that power, since the stake was part of the original takeover attempt which the Commission prohibited.

Aer Lingus' application to the Court of First Instance will be made in the coming weeks.

Aer Lingus will also ask the Court, as a matter of urgency, to make an order to prevent Ryanair from interfering in the running of Aer Lingus' business pending judgment on the appeal.

Summarising the Aer Lingus position Mr John Sharman, Chairman said "We are fully prepared to face competitive opposition on the runways and despite its attempts to portray us otherwise, a strong, independent and competitive Aer Lingus is an issue for Ryanair, particularly out of Dublin. Since this time last year, Ryanair has pursued every available tactic to prevent the further development of Aer Lingus as a competitive force, in order to defend its own patch out of Dublin."

Mr Sharman concluded "Ryanair's reason for buying shares is to control Aer Lingus via takeover. While the European Commission has rejected any takeover, Ryanair has appealed against that decision and in the meantime has used its shareholding to attempt to interfere with the commercial business of Aer Lingus and to further its own interests.

“This confirms that the real and only purpose of it holding the shares is its plan to obtain control over its main Irish competitor. As the takeover has been barred, it follows that Ryanair's shareholding, built up for the purpose of mounting a takeover, should also be barred."