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Ryanair - 3

Old 5th Oct 2006, 08:11
  #61 (permalink)  
 
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60,000 euros each should soften the blow for the employees as reported in Irish papers this morning.
http://www.thisismoney.co.uk/investi...0&in_page_id=3
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Old 5th Oct 2006, 08:14
  #62 (permalink)  
 
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Ryanair launches Aer Lingus Takeover

Am extremly surprised to read Ryanair has built up a large stake in Aer Lingus since its flotation in the last week and also is now going for a full takeover bid. I dont think this was the intention of the Irish Govt when it floated its stake in the airline. Do you think competition rules may prevent this? Ryanair are saying its a unique opportunity, i think its a strange strategic choice to be honest , if they did take it over i wonder what changes they will make to Aer Lingus longhaul ops?... will have to see how this one plays out!
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Old 5th Oct 2006, 08:20
  #63 (permalink)  
 
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I remember him saying he wouldn't take EI as a present.

Now he thinks it's worth £1 bn.

Every roller coaster ride comes to an end.
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Old 5th Oct 2006, 08:25
  #64 (permalink)  
 
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He may have said that he would not take EI if given it as a present but anybody that might be interested in buying something is not going to talk up its value!
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Old 5th Oct 2006, 08:41
  #65 (permalink)  
 
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Hmm let me see, Aer Lingus:

All Airbus fleet.
Full union representation.
Long-haul routes.

Ryanair, none of the above. I can see how this would be a match made in heaven at just about every level. And of course no sour grapes between Ryanair (in particular Tony Ryan) and the Aer Lingus management. Oh yes it is a tremendous opportunity….for what exactly? Based on Ryanair's previous record of the rape and pillage of Buzz: it's employees, it routes and it's fleet, I can foresee certain difficulties if this was to go ahead.
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Old 5th Oct 2006, 08:56
  #66 (permalink)  
 
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Originally Posted by Robertkc View Post
What % of Aer Lingus is owned by the employees again?
Almost 15%. The Irish government also still hold at least 25% of the shares.
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Old 5th Oct 2006, 09:01
  #67 (permalink)  
 
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Are there not questions to be raised concerning EU anti-competition laws? The take over would effectively mean Ryanair would have a monopoly on Ireland's medium and long-haul operations.
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Old 5th Oct 2006, 09:05
  #68 (permalink)  

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It certainly looks a strange move on a few levels. On a strategic level, FR has a very clear strategy that works, competing on a low cost basis, one aircraft type short-haul routes, no unions, ultra quick turnarounds etc. They are now trying to buy a very different company, heavily unionised, long-haul routes and a very different cost base.

Business academics would warn against this possible devastating tinkering with this strategy.

It'd be like Southwest buying NWA, it will surely change an awful lot in FR.

The various unions will be up in arms over this as will the Irish govt. Bertie Ahern's constituency is North Dublin and he like Ray Burke always had a cosy little relationshiop with the unions, give me your votes and I'll look after you. He'll be under pressure over this as well.

So all very strange at this point...
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Old 5th Oct 2006, 09:14
  #69 (permalink)  
 
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Roger, how's this? Drop the short-haul fleet over time to a minimum as Ryanair can always do it cheaper (Aer Lingus "unprofitable" on a route, it's dropped, but then Ryanair pick it up). Aer Lingus shorthaul reduced to places like LHR/AMS where they have to interline, A320s dropped as their leases expire over time. Do a deal with Boeing for new long-haul aircraft, leave Mannion to do what he has stated from day 1 he wants to do and make some money on long-haul.

Simplistic, I know, and anti-competition may well have its say - but if the yield is better from leaving their cash in the bank, how can MOL lose? Apart from that, maybe RYR heard that someone they don't like were preparing a bid for Aer Lingus, so they've decided to spike it by using their cash, and in any case they could always sell it to the other party in time and make some more money.

And this should all stop now because someone in the unions will be upset?

Be afraid......
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Old 5th Oct 2006, 09:17
  #70 (permalink)  
 
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they have said on the BBC website that he intends to keep the 2 airlines competing for a while. What he says and does may be 2 completely different things. Might be a way around the anti-competition laws. Keeping them as separate entities.
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Old 5th Oct 2006, 09:18
  #71 (permalink)  
 
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If Bertie survives his current little domestic difficulties (which I suspect he will) I imagine that not only will his devotion to his North Dublin voters influence his view but also his utter contempt for MOL may also be a factor.
There is no love lost between those chaps.
While the state only retains about 25% (is it 28%?) of Aer Lingus, is it not still in the governments power to stuff this takeover?
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Old 5th Oct 2006, 09:18
  #72 (permalink)  

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"However, Minister for Finance Brian Cowen and Minister for Transport Martin Cullen stated that the Government remains fully and firmly committed to competition in aviation markets, adding it would not sell its shares in Aer Lingus."
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Old 5th Oct 2006, 09:23
  #73 (permalink)  
 
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I guess that the banks who control a lot of the shares would be delighted to cash their chips in .As for the hapless aer lingus staff .....mmmm better get the tin hats on guys and girls.

Last edited by camel; 5th Oct 2006 at 09:40.
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Old 5th Oct 2006, 09:36
  #74 (permalink)  
 
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what could happen?

If the bid fails then ryanair have another argument against there goverment to try and get publicity.
If the suceed then they will have an even bigger battle with Dublin airport.
They will have somewhere to use all the 737s that are on the way.
They can take out Aer Lingus short haul and rise prices.
Aer Lingus long Haul could be sold on for more than they paid for the whole airline, LHR slots are very valuable on there own.

But will it all go wrong?
The EU will try and stop it..
The unions will go mad.
The ryanair model will break.
MOL will take his eye of the core buisness.

Is it a smokescreen to hide the downturn in lowcost travel since August.
Why are they taking such risks. Mergers are a good way to hide things in the accounts.
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Old 5th Oct 2006, 09:43
  #75 (permalink)  
 
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Originally Posted by cortilla View Post
..he intends to keep the 2 airlines competing for a while. What he says and does may be 2 completely different things. Might be a way around the anti-competition laws.
That won't satisfy the competition regulators. They aren't that st*pid. Ryanair & Aer Lingus have a combined market share of something in the range of 67% on London-Dublin. Anything over 40% usually gets them nervous!

I like the idea that MOL has done this to usurp 'someone' else who may have been snooping around - any idea who this could be? (My vote: Emirates). They'd love to get their mits on the slots that Aer Lingus has at LHR.
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Old 5th Oct 2006, 09:46
  #76 (permalink)  
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Like uklad007, I am also stunned at these developments! It will be very interesting to see what the EU and Irish competiton authority will say to this move. The Ryanair website have an analysis however, on their plans for EIN should they assume majority control.

I can't see them being allowed adjust the long-haul ops too much , actually I don't think they'll do anything to them given that they're all profitable and Ryanair state on their website that they will "retain all profitable routes currently operated by Aer Lingus".

Also all Heathrow slots will be retained for obvious reasons.

Let the games begin!
 
Old 5th Oct 2006, 09:52
  #77 (permalink)  
 
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Union Response from the Irish Independant:

The main trade union at Aer Lingus has slammed Ryanair's announcement this morning that it is launching a formal takeover bid for the airline.

SIPTU president Jack O'Connor said today that the proposed buy-out would be bad for the country and vindicated the union's stance in opposing privatisation.

He also said the Government should have seen the move coming when it decided to sell Aer Lingus to private investors.

The Labour Party, meanwhile, has called on the Fianna Fail-Progressive Democrats coalition to state what steps it intends to take to protect Aer Lingus from the takeover.

Party spokesperson Roisin Shorthall has described the Ryanair move as "a potentially disastrous development for the Irish travelling public".

She says it is exactly the sort of the situation the Labour Party warned could arise from the "ill-judged and unnecessary" decision to privatise the national airline.

While the Irish Goverment had this to say:

The Government has responded to Ryanair's Aer Lingus takeover bid by saying it will not be selling its shares in the airline.

Ryanair confirmed this morning that it has already acquired 16% of Aer Lingus shares and is offering €2.80 for the remainder.

In a brief statement to the media, Finance Minister Brian Cowen and Transport Minister Martin Cullen said the Government remained committed to competition in aviation markets and would not be selling the 28.3% stake that it has retained in Aer Lingus.

S.C.
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Old 5th Oct 2006, 09:54
  #78 (permalink)  

Jolly Green Giant
 
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And there's also the Dermot Mannion connection between EI and EK

And a consortium of ME business interests were looking at BA a while back but were out off by the pensions deficit. Interests in the UAE are going on major shopping sprees lately, the Dubai Aerospace Group only a recent start up, has already bought SR Techics and has a huge war chest

Look at Qatar airways as well, building a new airport and also unlimited funds...
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Old 5th Oct 2006, 09:55
  #79 (permalink)  
 
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If you had £1000 with which you had to buy shares in an airline in which of the following four airlines would you invest.


1. British Airways

2. Aer Lingus

3. Ryanair

4. Easyjet


Personally I would invest in Ryanair. This is to ignore the current takeover furore.

The only thing that is preventing a takeover of BA at the moment is the size of the pension deficit and we know about Aer Lingus.
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Old 5th Oct 2006, 10:00
  #80 (permalink)  

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Government called on to protect Aer Lingus By Patrick Logue Last updated: 05-10-06, 10:53
Reaction: The Government must immediately state how it intends to protect Aer Lingus from a "predatory takeover", Labour said this morning.
The party's spokeswoman on transport Roisin Shortall also said Minister for Transport Martin Cullen and Aer Lingus management must also state if they were aware of moves by Ryanair to takeove Aer Lingus.
"The public will have been shocked by the disclosure this morning," Ms Shortall said.
"This is a potentially disastrous development for the Irish travelling public and is exactly the sort of situation the Labour Party warned could arise from the government's ill-judged and unnecessary decision to privatise the national airline," she added.
In a short statement this morning the Government said: "The Minister for Finance, Brian Cowen, TD, and the Minister for Transport, Martin Cullen, TD, have stated that the Government remains fully and firmly committed to competition in aviation markets. It will not sell its shares in Aer Lingus".
Siptu General President Jack O'Connor said a Ryanair takeover of Aer Lingus would be bad for the country.
"Anyone with a titter of wit could have foreseen this development", Mr O'Connor said in a statement.
"It will enable Ryanair to take out its principal competitor on their main routes, acquire the critically valuable Heathrow 'slots', consolidate market dominance and dictate whatever price they like to airports, with obvious long term adverse consequences for workers and the travelling public alike.
"All of this is a consequence of the nonsensical decision to privatise Aer Lingus in the first place."
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