Wednesday 26 October 2016

Government formally accepts IAG's €1.36bn takeover bid for Aer Lingus

Published 16/07/2015 | 16:47

Aer Lingus
Aer Lingus

The Government has formally accepted IAG's €1.36bn takeover bid for Aer Lingus.

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During an extraordinary general meeting in Dublin this morning, Aer Lingus shareholders backed the sale of the airline to British Airways owner International Airlines Group (IAG).

 Shareholders voted overwhelmingly in favour of all four resolutions, including measures relating ​to​  connectivity guarantees, ​thereby ​clearing the way for​ the sale.

 Speaking in the last few minutes, Transport Minister ​Paschal Donohoe ​said the outcome was the "right decision" for long term growth in Ireland.​

 "This now provides the company with the platform to grow, to be competitive and to be secure in the future, and to deliver even better access for our country," he said.

 "This is a very significant decision, with a huge amount of time given to it.

 "As a result of Aer Lingus becoming part of the IAG group, it will be able to grow at an even faster pace in the future."

 He stressed Aer Lingus will create 150 new jobs next year, with further 600 jobs to be announced within the next five years.

 "It gives the airline the platform to create further jobs, and more access into our country," he added.

 IAG could be in control of the airline within two weeks if the takeover goes ahead, Aer Lingus chairman, Colm Barrington has said.

 Speaking at this morning's egm, he also said it was a “gross mistake” to say that Aer Lingus has raided the pension fund.

 One shareholder criticised the fact Aer Lingus had approximately €1bn in cash considering there had been a pension deficit.

“Everyone knew of the pensions deficit, you raided the pensions and yet there’s a billion in the bank. You couldn’t fund pensions out of the billion euro fund you have?” he asked.

Read more: European Commission clears €1.36bn takeover of Aer Lingus by IAG

“Aer Lingus has not touched the pension fund. In fact it has contributed significantly to it,” said ​Mr Barrington.​

 A number of people protested outside the egm over cuts made to the pension scheme.

 Speaking after the meeting, Mr Barrington said the takeover didn’t spell the end of an era for Aer Lingus.

“The company is still Aer Lingus, still got the same people, the same brand, the same routes, the same customers. It’s just a change of shareholders from the Government and Ryanair, and some institutions, to IAG,” he said.

 Mr Barrington added that he had “no regrets” seeing the change in shareholding.

 He said the takeover will create jobs, adding that shareholders concerned by the takeover are misguided.

“Those concerns are unfounded. We expect that by the end of 2016 there will be another 165 jobs, at least, directly created in Aer Lingus, We expect 650 direct jobs by 2020,” he said.

 IAG wants to use Dublin as a transatlantic hub, and said it is committed to growing the Irish airline.

 It launched its takeover bid for Aer Lingus in January.

 The European Commission gave approval for the takeover this week.

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