Merger with 'flagging Ryanair would hurt Aer Lingus brand'
The chief executive of Aer Lingus has claimed Ryanair boss Michael O'Leary wants a merger to go ahead because his own brand is "beginning to flag across Europe".
Dermot Mannion said Aer Lingus, which "never leaves you stranded", would be "damaged" by an association with the budget airline.
He said Aer Lingus would soon launch a "very aggressive defence strategy" against the budget carrier's half-price bid for the airline, which was unveiled last week.
Ryanair has offered €748m for Aer Lingus -- roughly half what it was prepared to offer when it made an initial bid for the company two years ago.
Mr Mannion revealed yesterday that Aer Lingus' management would make a strong case against the bid and persuade shareholders that an "independent, strong Aer Lingus is the right way to go".
The government, which has a 25pc stake in the airline, is believed to have adopted a neutral stance to the bid.
The Employee Shareholder Ownership Trust, which has a 14pc stake, would not reveal its stance following a meeting of the trustees on Monday.
Mr Mannion seemed confident that the bid would not succeed as the European Commission had already rejected Ryanair's first bid.
He denied that Aer Lingus, which announced losses of around €22m this year, was in a worse financial position to Ryanair, which is expected to break even next year.
Projection
Although Aer Lingus had predicted losses next year, Mr Mannion said it would be reviewing this projection after achieving €50m staff savings through agreements with unions.
This would place it in a better position to compete with Ryanair, he said, and revealed the airline is eyeing opportunities for expanding its short-haul operations in Ireland and abroad.
"The Aer Lingus brand is continuing to improve and Michael O'Leary knows it," he said.
"One of the reasons why Ryanair wants this merger to go ahead is because its own brand is beginning to flag across Europe. It's very simple. Aer Lingus has the strongest balance sheet in Europe.
"We have a brand like no other. There is no doubt that the Aer Lingus brand would be damaged by association with Ryanair.
"There may be airlines throwing shapes but nothing to suggest a merger is the right strategy.
"Aer Lingus has an independent strategy and has and will develop strategic partnerships when it feels the need to do so."
- Anne-Marie Walsh Industry correspondent
