Ryanair launches fresh bid for rival Aer Lingus

Budget airline Ryanair has launched a fresh takeover bid to acquire fellow Irish airline, Aer Lingus.

A previous attempt by Ryanair to takeover Aer Lingus was blocked by the European Commission on competition grounds.

Today’s offer values Aer Lingus at €748 million (£619 million) and Michael O’Leary, Ryanair’s chief executive, claims that the all-cash deal will create a single ‘strong Irish airline group’.

As with many other airlines, Aer Lingus has been hit by the economic downturn and the soaring cost of oil which has put several airlines out of business this year.

However, Mr O’Leary believes the offer will give Aer Lingus a strong partner to secure its future.

Should the deal proceed, both airlines would continue to operate as separate companies with their own brands.

Mr O’Leary is optimistic that the European Commission will look more favourably this time round, since the ‘world has changed in the last six months‘.

Ryanair, which already owns a 29.82% stake in Aer Lingus, is offering to pay €1.40 a share for the outstanding shares, a 25% premium on Aer Lingus’s closing share price on Friday.

Other major shareholders include the Irish government and Aer Lingus employees.

Aer Lingus is urging shareholders to take no action until it has issued a formal statement.

Story link: Ryanair launches fresh bid for rival Aer Lingus