Monday 25 September 2017

'I'm not a traitor' - Donohoe on Aer Lingus

Behind-the-scenes drama in the final days leading to sale of airline revealed

BEST DEAL: Paschal Donohoe
BEST DEAL: Paschal Donohoe

Daniel Mc Connell

Transport Minister Paschal Donohoe has strongly rejected claims of treachery labelled at him by members of the opposition for recommending the sale of Aer Lingus to IAG.

In an interview with the Sunday Independent, Mr Donohoe said many of the claims by opposition politicians last week were "extraordinary".

Mr Donohoe's claims come as it has emerged he met with IAG boss Willie Walsh face to face in Dublin three times during negotiations.

The minister was severely criticised by some members over the deal, with Socialist TD Ruth Coppinger describing the sale of the national carrier as an "act of treachery".

However Mr Donohoe rejected the accusations.

"Absolutely not... I do think some of the comments from opposition spokespeople on the deal were quite extraordinary," he told the Sunday Independent. "I mean the number of allegations of treason made. Absolutely not. I was quite struck by that."

Mr Donohoe has also rejected suggestions that the €2.50 per share price tag represents a bad deal for the taxpayer.

"In relation to the share price, we had independent advice to tell me it was a good deal and a good price," he added.

The Dublin Central TD also hit out at those who criticised his handling of the deal, saying it scared off other potential buyers.

"Folks that would say that somebody else could have come out and offered a better price. I'd ask the simple question, if that is the case, then who and why haven't they come out so far," he said.

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Mr Donohoe again stressed that the whole deal could still fall asunder if Ryanair refuses to divest itself of its shareholding in Aer Lingus.

Asked what he thinks will happen, Mr Donohoe was extremely coy about the matter.

"What Ryanair do is a matter for Ryanair. IAG have made it clear that they will only go ahead with the full deal if Ryanair also decides to dispose of their share too," he said.

But it is understood that Mr Donohoe and Ryanair boss Michael O'Leary have agreed some form of a pact which saw Ryanair stay silent on the Government's stake during the talks in return for Government silence while Ryanair comes to its decision.

COLM McCARTHY & PASCHAL DONOHOE ON AER LINGUS: PAGE 20

Mr Donohoe insisted that the Government was not swayed to sell its stake in Aer Lingus because of Mr Walsh's position at the head of IAG.

"I should make clear that none of this happened not to do anything or make any of these decisions because it is an Irishman running IAG," said Mr Donohoe.

"Because it is an obvious point, at some stage other people will be running IAG, and other people will be running Aer Lingus. That is why we have put so much effort into the guarantees that were put in place in the articles of association," he added.

Mr Donohoe was speaking to the Sunday Independent as key details of how the agreement was achieved have emerged.

It is understood Mr Donohoe and Mr Walsh met face to face three times in the offices of various law firms around Dublin throughout the extended process.

At those key meetings, Mr Donohoe won significant concessions from Mr Walsh particularly in relation to the retention of the crucial Heathrow slots.

Despite those face-to-face meetings, the process was delayed substantially, simply by a desire by Mr Donohoe and his officials to get sufficiently robust guarantees on the Heathrow slots, employment and dealing with the EU.

One source close to the process said: "The main thing that delayed it was the amount of time that had to go on securing the right kind of agreement and texts to reflect those agreements took a lot of time.

"Concerns about the robustness of the guarantees meant other people had to look at it. That all took time."

It has also emerged that the minister met with the union leaders at 8am last Tuesday morning before he went into Cabinet to get their reaction to the deal.

They were adamant in their opposition to the deal as it stood, but over the next 48 hours, Mr Donohoe and Aer Lingus chief executive Stephen Kavanagh, hammered out several extra guarantees in order to assuage union concerns.

Backbenchers in Fine Gael and Labour have also spoken of the importance of presentations made by Mr Donohoe and Mr Kavanagh to both parliamentary party meetings in order to address back bench concerns.

Mr Donohoe and his officials also met with Labour TD Michael McNamara on Wednesday night in order to try and secure his vote but it was not to be, with Mr McNamara opposing the deal and as a result losing the party whip.

It has also emerged that junior minister Ged Nash also played a key role, given his industrial relations background, in securing agreement from his party colleagues and assuaging union concerns.

Sunday Independent

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