THE BOARD OF Aer Lingus has reiterated its recommendation to shareholders that they should reject an offer tabled by Ryanair last month.
In a written statement this morning, the airline said it had received no new information from its rival since it last wrote to shareholders on 31 July.
The unanimous view at the boardroom table is that the €1.30 per share cash offer from Ryanair “fundamentally undervalues” the company.
“Aer Lingus is a strong and profitable airline with a proven business model; a strong balance sheet; and an internationally recognised and valued brand,” board members said.
They added that the takeover bid “represents a significant discount to the intrinsic value of the business”.
Based on careful consideration of the issues, and extensive legal and financial advice, the board remains of the view that Ryanair’s offer is not in the interests of shareholders, fundamentally undervalues the business and, due to the scale and extent of competition issues, is likely once more to be prohibited by the European Commission. Accordingly, the board unanimously recommends shareholders take no action in relation to the offer and should not sign any document sent by Ryanair or its advisors.
This is the third written rejection recommendation issued by Aer Lingus to its shareholders.
On 17 July, Ryanair made a formal bid of €694 million for Aer Lingus. The offer will remain open until 3pm on 13 September this year.
In his attempts to convince shareholders to sell, CEO Michael O’Leary said Aer Lingus has “failed to deliver value” in its six years as a public company. He believes that significant changes in the air transport market in Europe will allow for the consolidation.
Ryanair already owns 29.82 per cent of the issued share capital of Aer Lingus but has failed in two other attempts to purchase a majority holding.