Sign in. It’s quick, free and it’s up to you.
An account is an optional way to support the work we do. Find out more.
ETIHAD HAS STRUCK a deal to sell of its minority stake in Aer Lingus, further clearing the path for the airline’s sale to suitor IAG.
The Middle Eastern airline, the third-largest in the region, has agreed to offload the 5% share it had built up in Aer Lingus as part of the proposed buyer’s €1.35 billion takeover bid.
Chief executive James Hogan told Reuters Etihad was keen to maintain a relationship with IAG after the sale and the indications were that the buyer, a conglomerate that includes British Airways and Iberia, was interested in doing the same.
Aer Lingus and Etihad struck a code-sharing agreement in 2012 which included the airlines cooperating on flights between Dublin and Abu Dhabi.
The government last month agreed to sell its 25% share in the national airline after IAG agreed to maintain flights between Irish airports and Heathrow for seven years, and to add up to 635 jobs by 2020, among other promises.
It came despite protests from opposition TDs that Irish staff would be cut as work was outsourced overseas under the deal. Left-wing independent Clare Daly claimed the main driver for the sale was satisfying the airline’s European and Middle Eastern shareholders.
Ryanair’s move
The deal values the government’s stake at about €335 million, while Etihad will get around €67 million for its shares.
However the sale still hinges on what Ryanair will do with its near-30% piece of Aer Lingus. The budget airline has already been ordered by UK competition authorities to sell down its share to 5%, a ruling it has been fighting for two years.
Ryanair previously launched several failed takeover attempts of the Irish flag carrier, while the aggressively-expanding Etihad was also once flagged as a potential buyer.
To embed this post, copy the code below on your site
hate to say it but actually hope ryanair get it, or 20 years from now aer lingus will be nothing more than a footnote in irish history.
Ryanair takeover will not get past the competition authority – just as it didn’t in 2007 and 2012
Agred too much sway from UK and Spain for little Ireland to sell to IAG. But if IAG get Aer Lingus it will become nothing more than a shuttle service to main hubs in Uk and mainland Europe.
IAG plan to close AL most profitable routes? IAG plan to move Dublin flights to the UK for long haul! You are living in fantasy lad of anything Dublin will be a hub for North of UK passengers to free up space in UK AIRPORTS
If Ryanair had of takene over Aer Lingus it would have been a footnote in under 10 years
Wayne Dublin would never become a hub it wouldn’t make sense! ! That would mean moving everyone to dublin before moving them on, why would you move everyone on to Dublin by plane when everyone is already in uk just few from dublin arrive.
Celtic, you clearly know nothing about how air travel and hub systems work in the airline industry!
I work for one of the IAG airlines and simply put, Aer Lingus is needed to free up congestion at Heathrow.
There is no room available to expand connections into Heathrow from the UK domestic regions. This is where Aer Lingus will pick up the slack by connecting its UK regional customers to Dublin and onwards to the U.S. And Canada! Dublin is the perfect facility for such a hub system and will take a lot of slack off BA and Heathrow.
you being the expert Tony explain to me how it makes profit by moving all ther customers waiting to get on a plane in UK land them Dublin to put few more on it? I know enough to know that it will be another Irish company gone. Sure they might employee few token Irish people but the long run Aer Lingus will go and all it’s profits to the UK. Bit like what happened to Roches stores , Quinnsworth, Pennys, Irish Gas all these Irish companies bought up by foriegn companies so all there profits and hard earned Irish money goes to someone else. So what ever chance of re investment there was it is completely gone. Let Ryanair take Aer Lingus use it for long haul it least it will be Irish
Celtic, what British Airways currently do is have everyone from say Manchester or Edinburgh fly to Heathrow and swap onto a second plane to fly to the US. This is unsustainable with the congestion at Heathrow so to have connecting flights from Liverpool, Edinburgh, Leeds etc go on Aer Lingus flights to Dublin or Shannon and then fly onwards is a great option for IAG especially with the US pre-clearance Dublin and Shannon offer.
Ive always believed that there is already a decent number of passengers that feed through Dublin from Northern England (the likes of Newcastle, Blackpool, Leeds, Bradford, York etc) and on to the US as its just as handy to do so (rather than travel to Manchester or Birmingham) and then to clear US immigration at Dublin. In fact Leeds/Bradford Airport seem to be agressively pushing the Dublin hub.
I think Tony could be spot on. Bigger things for Aer Lingus on the horizon.
Celtic, BA do not operate grand Atlantic flights from Scotland! All passengers have to go via LHR or Manchester. Both of which have zero capacity for increased routes and no pre clearance for the USA. Ethiopia airlines are currently operating US flights via Dublin because of ore clearance!
IAG have pretty much highlighted Dublin as a hub for US flights as the preclearance and the time saving it offers would outweigh the stopover
well hope you are all correct. Because the government obviously don’t have your confidence other wise why make 7 year clauses into selling of their shares.
Wayne, the biggest issue with this AL takeover is that people only want to see it from a political viewpoint, ignoring the business common sense it represents.
Celtic, I’m not sure you understand how developing a hub airport works. It’s about identifying customers elsewhere that can be moved quicker and more effeciently from one place to another.
I’m aware how a hub works I just don’t share some people’s enthusiasm for us selling aer lingus to a company that has no connection or responsibility to this country. Correct me if I’m wrong but LHR is trying to expand but is facing a lot of opposition at the moment. not sure if it has gotten go ahead but if UK felt LHR was going to be side stepped by Dublin they will be pushing the LHR more aggressively
Celtic, Heathrow slots was the political red herring about the IAG takeover of AL. With ownership of AL, IAG get a big bargaining chip at major UK airports. We help you solve conjestion with Dublin as a hub for transatlantic routes, and you help us deliver on the commitment we made with the Irish government on Heathrow slots
Celtic, ‘us’ isn’t selling AL. That happened years ago and it’s a mindset we need to get out of. AL is a private company with shareholders. AL is based here but it no longer has an inherent ‘responsibility’ as an airline to the country. It’s like removing the engine from a car, selling the car, and then still claiming you own the car.
I side with the others here…
The difference in Air passenger duty for a long haul flight is about £120 economy and £250 business/first.
With 350 economy and 115 premium in an A380 for example. That means a BA plane leaving from Dublin vs. Heathrow is £72k more profitable.
Celtic you mean a 7 year clause on LHR slots? That only effects IRl to eng flights? Again the 2nd most profitable part of AL business is the London routes, so why diamanté them? Anyway London is well serviced via stansted, and London city LHR is not the only airport option
To Clear U.S. Customs!
Agreed Celtic.
There is a sadness in losing this most Irish of brands which we all grew up with.
Love or hate O ‘Leary, they don’t come much more Irish than Mick.
FG will be remembered for the selling of our national airline. The crowd who wanted to tax children’s shoes. House tax. Water tax. The crowd whom evicted families. The crowd who destroyed a nation to appease European masters.
The crowd whom saved the elite at the expense of a nation. Traitors to the Irish flag.
Idiot!
You mean 20% of it… Because it’s not like they couldn’t just stage a hostile takeover regardless by obtaining even half the remaining shares.
They just don’t want the bad PR of taking it by force.
Willy, Fianna Fail sold EI in 2006.
Peter.
How could Ethiad ever have owned Aer Lingus ? Non EU airlines can only own a maximum of 49% of an EU airline. So it could never have bought Aer Lingus. It could have increased its shares but that is it.
Can you please explain . Thanks
By establishing an Irish based subsidiary or silent partner.
Not unlike Virgin America in the United States.
I still don’t get why the EU block Ryanair, but not BA/Iberia – if anything, Ryanair would be better for Ireland as a whole.
Ryanair and Aerlingus control approx 98% of flights in and out of Ireland. Fairly simple really BA & Ibera have about 6 flights a day
Still doesn’t make sense to me Wayne. If Ireland was worth the hassle they would build more routes – instead they are just buying out the competition. As for the UK Authority – why have they got any say in an Irish merger??
Because it involves a British company! Duh!!!
People already complain about the price difference between Dublin and more competitive UK airports on a variety of European routes – we do need to keep some level of competition on flights out of Dublin
Etihad are obviously worried, IAG have a partnership with Qatar Airlines their main competitor and I would imagine that would be the end of the Etihad codeshares
More than a partnership… Qatar recently bought 10% of IAG, making them one of the biggest single shareholders
have your say