Thursday 8 December 2016

IAG expects Aer Lingus decision in two weeks

Published 01/05/2015 | 02:30

IAG chief executive Willie Walsh expects the Government to make a decision on the future of Aer Lingus within the next two weeks
IAG chief executive Willie Walsh expects the Government to make a decision on the future of Aer Lingus within the next two weeks

IAG chief executive Willie Walsh expects the Government to make a decision on the future of Aer Lingus within the next two weeks.

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A decision will draw to a close months of uncertainty about Aer Lingus, which IAG wants to buy for almost €1.4bn.

The Government is weighing up whether or not it should sell the State's 25.1pc stake in Aer Lingus to IAG as part of a takeover.

Transport Minister Paschal Donohoe expects to shortly receive a steering group report.

Mr Walsh said yesterday that he's in no hurry for a decision to be made by the Government.

It's now over four months since IAG first indicated it was interested in buying Aer Lingus. IAG also needs Ryanair to agree to sell it its near 30pc stake in Aer Lingus. Mr Walsh has refused to be drawn on the level of commitment IAG has pledged to the Government if it agrees to sell its stake, however.

IAG had previously told the Government that it would use prized take-off and landing slots controlled by Aer Lingus at Heathrow to serve only routes to Ireland for at least five years following a takeover.

But the Government has sought a 10-year guarantee, something IAG was unwilling to offer. However, it's believed that sufficient common ground has been found between the two. A seven-year guarantee with some conditions attached is possible.

Mr Walsh was speaking as IAG, which owns British Airways, Iberia and Vueling, revealed it made a €25m profit in the first quarter - the first time it has ever made a profit in what is normally a loss-making period. It made a €150m loss in the first quarter of 2014.

The group is on track to make a profit of €2.2bn this year, compared with €1.4bn in 2014.

The chief executive of the Dublin Airport Authority, Kevin Toland, also lent his support yesterday to a takeover of Aer Lingus by IAG. "I'm absolutely a strong supporter of the proposal," said Mr Toland.

IAG wants to use Dublin as a hub for transatlantic passengers and to expand the Aer Lingus long-haul network.

Meanwhile, Aer Lingus has just announced a new partnership deal with the IRFU, which will see it become "the official airline of the Irish rugby team".

The airline's safety videos are about to get a whole lot more watchable as a result - with the likes of Rob Kearney lined up to instruct passengers.

Irish Independent

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