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Aer Lingus - 4

Old 26th Mar 2007, 16:35
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Aer Lingus - 4

The Aer Lingus board considered mounting a takeover of BMI, the UK carrier formerly known as British Midland, earlier this year.

The board was looking at fall-back positions in the event the Open Skies deal, which was concluded last week, did not go ahead.

The airline also ran the rule over a number of other European low-cost carriers, including Flybe, which earlier this month bought all of British Airways regional routes to become the largest regional airline in Europe. It flies on 152 routes from 22 UK airports to 36 European destinations.

Although a number of carriers were looked at, the most serious contender was British Midland.

It is understood that the previous Aer Lingus management, led by Willie Walsh, the current British Airways chief executive, also harboured plans to mount a bid for BMI, once it had restructured Aer Lingus. Discussion with BMI did take place, but it is understood they centred on the possibility of Aer Lingus acquiring a number of long-haul aircraft from BMI.

The airline, which is controlled by former baggage handler Michael Bishop, dropped flights between Heathrow and Mumbai last year due to intense competition, leaving it with two surplus aircraft.

Suitable

The Open Skies deal means those aircraft are no longer surplus as all carriers scamble to increase their transatlantic services.

A shortage of suitable airplanes is hampering the growth of airlines around the world.

Even in advance of knowing whether the Open Skies deal would be signed it is understood the Aer Lingus board decided against mounting a bid for BMI.

One source said: "You buy an airline because you want their aircraft, or you want their slots for new aircraft, or you want their management. None of these apply to Aer Lingus."

Unlike Aer Lingus and Ryanair, which operate only one aircraft type and one engine type on their short-haul routes, BMI operates a number or different types, making it a less attractive acquisition target.

That has not stopped Richard Branson's Virgin running the rule over BMI. Mr Bishop and Nigel Turner, the BMI chief executive, have consistently maintained that the airline is not for sale.

Mr Bishop owns 50pc plus one share in the airline. SAS, a Scandinavian carrier, has 20pc, and Lufthansa, the German flag carrier, owns 30pc, less one share.

Although the possibility of a BMI takeover by Aer Lingus is no longer on the cards, that such a move was considered shows the determination of the Aer Lingus board to pursue an independent strategy.

Ryanair, which owns 26pc of the Aer Lingus, is awaiting a European Commission ruling on whether it can go proceed with a takeover of the former semi-State company.

Source: Irish Independent
http://www.unison.ie/irish_independe...issue_id=15412
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Old 26th Mar 2007, 19:38
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Aer Lingus had eye on BMI

Well thank God that did not happen.Aer Lingus would have brought bmi down to their "race to the bottom" level leaving Dublin- London Heathrow without a business class service. bmi service on this route is excellent and long may it last.
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Old 26th Mar 2007, 21:56
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Err......

Would that be SIR Michael Bishop, the former Manchester station manager for Mercury Airlines, later sold to BMA and who rose through the ranks to become Managing Director of British Midland, ultimately making one of the first management buyouts with his two business partners to become chairman of BMI?

Manners and respect cost nothing as my father taught me.
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Old 26th Mar 2007, 22:45
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Well said Oscarh
Talk about demeaning a mans achievements in one sentence...
The guys a legend...
(ok, and he pays my wages......) !
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Old 26th Mar 2007, 23:04
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The above article was written by one Tom McEnaney. Anyone familiar with his brand of "journalism", and indeed that of the Irish Independent, will understand the utter lack of respect, which was most likely intended.

A real journalist would no doubt be vexed at how often his (or more accurately ryanairs, masquerading as his own) predictions and forecasts prove wrong.

As for the Irish Independent, it is a rag of the highest degree, made even more insidious by pretending to be a "quality" newspaper. Not only is sensationalist, non-newsworthy pap its forte, it is also an uncritical and simpering unofficial ryanair newsletter. Enough said.
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Old 27th Mar 2007, 04:04
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I know foreigners can't buy control of airlines in the USA but can Americans take control of UK airlines. If so could be a way to get some valuable slots if one of the US majors could afford BMI.Mind you if BMI came openly on to the market i reckon their would be a lot of interest..
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Old 27th Mar 2007, 08:10
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What a load of old cobblers...Aer Lingus can barely organise themselves, let alone take over another airline - and just where was the money going to come from?? They've been run out of UK regional routes, they're now getting a serious run out of DUB from Ryanair, they can't come to a working relationship with the unions...who does this journalist think he's kidding????

Even if it's true, then the board should be looking to sort out the future of Aer Lingus, not fanny about on Fantasy Island...
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Old 27th Mar 2007, 09:03
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Oldlag, your such a stirrer. Ei out perform every UK airline with the exception of Easy and do it to a back drop of Fr. The flights are largely full and and the performance figures speak for themselves add to that 1bn in cash and you can see why Fr wants to by it. I wouldn't discredit Sir Michael Bishops achievements but perhaps you might afford Ei the same curtsy. Camelhair was right on the money with his critique of Tom McEnaney writings. His sniveling,sycophantic outpourings will do nothing but raise your blood pressure and I'm annoyed at myself for even responding to a thread based on his drivel.
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Old 27th Mar 2007, 10:23
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..and of course, with the "former baggage handler" having a controlling stake in the privately owned bmi he would have been well within his rights to tell them to go and whistle. Which he would surely have done.

Unlike Aer Lingus and Ryanair, which operate only one aircraft type and one engine type on their short-haul routes, BMI operates a number or different types, making it a less attractive acquisition target.
I would imagine that's news to the bmi board. I can only assume he means they would have tried to take over the whole group. Don't make me laugh!!

That has not stopped Richard Branson's Virgin running the rule over BMI
...and the point of that statement is?

Obviously this "journalist" (meant in the same derogatory tone as "baggage handler") is of the highest calibre.
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Old 27th Mar 2007, 10:28
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The above article was written by one Tom McEnaney. Anyone familiar with his brand of "journalism", and indeed that of the Irish Independent, will understand the utter lack of respect, which was most likely intended.
Hear Hear!
And oldlag53 - get a life.
Or better still, join the Indo as a journalist.
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Old 27th Mar 2007, 16:42
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Typical silly season story which was probably hashed together in a pub at dinnertime.

More holes in that than a hole factory. Such as one salient point...you can't mount a takeover bid for a company which isn't traded on the stock market.
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Old 27th Mar 2007, 22:28
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So EI were going to buy bmi & then then they'd be collectively bought-out by the Ryans when they launch their next bid for them!
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Old 27th Mar 2007, 22:34
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His chance of doing that gets more remote with every cent on the 'Lingus share price.

Its up 105 cents since launch in September, and still climbing.

Too bad, Micko missed out.
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Old 28th Mar 2007, 09:35
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Danger

If the deal had of gone through and hypothetically speaking FR did buy out Aer Lingus they would have destroyed the Irish aviation industry and part of the UK's aswell.
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Old 28th Mar 2007, 10:58
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Ei out perform every UK airline with the exception of Easy
Curser, could you please clarify the criteria you are using to come up with this assertion??

The flights are largely full and and the performance figures speak for themselves
This is just lazy writing - no facts to back this up whatsoever. If you'd bothered to look at the 2006 prelims, you would see that EIN's load factor is 77.6%, down from 81.4% the previous year.

As someone has already pointed out, the original article was a complete load of tosh as you can't takeover a privately-owned company.

Aer Lingus needs to get real, sort out the unions, come up with a realistic picture of its present and future strategy, and not get sidetracked with starry-eyed nonsense about taking over other airlines.
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Old 28th Mar 2007, 11:30
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As someone has already pointed out, the original article was a complete load of tosh as you can't takeover a privately-owned company.
So why did you feel the irresistible urge to hit the keyboard and pass comment on it then?

Aer Lingus needs to get real, sort out the unions,
Do us a favour, spare us the spin and instead write to Dermot Mannion - ask him why he chose to recently blow a further 16 million euro on the same Suits who screwed up his flotation.

It was the pilots UNION who saved Aer Lingus from the clutches of O'Leary, with no help from that fool.

I refer you to THIS thread.

Last edited by maxalt; 28th Mar 2007 at 13:37.
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Old 28th Mar 2007, 13:29
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Corporate Scandal: Snouts in Trough at Aer Lingus

This is for all those who blame 'the Unions' for every ill.
Article from Phoenix Magazine.
THE PHOENIX
AER LINGUS SHOWERS SUITS WITH EURO 16.2 Million Euro

While Dermot Mannion, Aer Lingus chief executive, is still hell bent on cost savings in the airline, surely the most startling figure in the 2006 results was the Euro 16.2m paid out defending the Ryanair hostile approach. This is a figure which beggars belief but no doubt the champagne corks were popping in certain offices in Dublin 2.

The Aer Lingus defence called for a response document and some common sense. That this exercise resulted in a 16.2m hole in the Aer Lingus accounts will not impress shareholders, especially since the document was found to be flawed by the Irish Takeover Panel, necessitating the issuing of a clarification on November 24.

So who are the masters of the universe who shared out the 16.2m just in time for Christmas?

The bulk of the lolly would have been split between the frontline advisers assembled by a panicked Aer Lingus board.

When Michael O'Leary's intentions became clear, Mannion called in Roy Barrett and Finbarr Griffin of Goodbody. Griffin had held the lead role for the stockbrokers in advising the Government on the floatation earlier in the year and presumably had something to say about the low price, which prompted O'Leary to start building his stake.

Also brought back to the feeding trough was Goldman Sachs International who had been paid millions by Aer Lingus itself on the floatation this time represented by Phil Reaper and Nicholas van den Arend, while Basil Geoghegan also joined in having advised Aer Lingus on the floatation.

And there was room for Merrion Capital's chief executive John Conroy to throw in his tuppenceworth. The stockbroking arm of the group Merrion Stockbrokers had previously acted for Aer Lingus during the floatation and Dan Ennis, who had been involved then, was called back in to help mount the defence.

These boys shared out the bulk of the fees while others who also got slices of the Aer Lingus action included K Capital Source (Mark Kenny and Jonathan Neilan) which dealt mainly with investor relations and Drury Communications (Billy Murphy and Padraig McKeon) and Powerscourt (Rory Godson) who handled PR, along with Aer Lingus's inhouse PR officer, Cillian Cullhane.

The legal advice came courtesy of Arthur Cox.

It will be interesting to see how the 16.2m compares with Ryanair's fees for its takeover attempt. O'Leary was advised by a significantly smaller team made up of Davy Corporate Finance (Hugh McCutcheon and u.Ugende Mulhem) and Morgan Stanley (Gavan MacDonald, Colm Conlon and Adrian Doyle) while the PR spin was provided by Jim Milton and Pauline McAlester of Murray Consultants and legal advice by A&L Goodbody.

Dermot Mannion has been boasting about his 'Programme for Continuous Improvement' a euphemism for staff cutbacks and pay freezes. It is ironic therefore that the Ryanair bid has effectively foundered not because of assorted Armani suited advisers but because O'Leary couldn't get his hands on the stake held by the under pressure and increasingly discontented ordinary staff through the Employee Share Ownership Trust.
The corporate snouts are buried deep in the Aer Lingus trough - while Mannion misdirects the mainstream media's attention at the unions.
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Old 28th Mar 2007, 14:07
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Wait 'til you see how much these sort of ******** earn out of the olympics !

Last edited by PPRuNe Pop; 29th May 2007 at 11:12. Reason: inappropriate wording
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Old 28th Mar 2007, 14:13
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So - you want Aer Lingus to be independent of Ryanair (presumably), yet you find payments to Goldman Sachs to be abhorrent.

Tell me, what exactly do you think Goldman Sachs did for this money? Starting with the hundreds of professionals in M&A who would have dropped everything to work on Aer Lingus all night for a period of weeks, resulting in a successful defence of the airline (nevermind that the document was flawed - it was successful).

Do you think these chaps listed acted alone? If so, you are totally incorrect - the names are only those of the MDs and directors who work on the transaction - below them are VPs, Associates and Analysts - who form the bulk of the headcount at investment banks - who were all working hard for you independence.

Don't attack the city if you don't have a clue what you are talking about!!
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Old 28th Mar 2007, 14:15
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I must be missing something. My suit says "Austin Reed" on the inside.

Preconceptions and illusion are the art of the newspaper, not the professional advisors.

Morgan Stanley on the Ryanair side, and GS on the Aer Lingus side would both be as expensive.
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