Aer Lingus deal cleared for take-off as cheques wing their way to shareholders
Aer Lingus shareholders are expected to start receiving payment for their shares in the next fortnight after IAG's deal to take over the former flag carrier cleared its final hurdle.
The long-expected deal has now been deemed "wholly unconditional" after Ryanair formally agreed to sell its shares in Aer Lingus.
Ryanair, which has owned more than 29pc of Aer Lingus for a number of years, had said it would accept IAG's offer to buy its shares, but missed a deadline to formally accept the offer at the end of last month.
IAG, which owns British Airways and Spain's Iberia, then extended the deadline to August 18.
A Ryanair spokesman said: "As we confirmed in our Q1 results, we submitted our acceptance of the IAG offer today."
In a statement, IAG said it "has received confirmation of the valid acceptance of its offer for Aer Lingus in respect of all the Aer Lingus shares held by the Ryanair Group. Ryanair's acceptance was a condition of the offer which is now wholly unconditional as all the conditions have been satisfied".
IAG chief executive Willie Walsh, who is also a former CEO of Aer Lingus, said his firm would "like to welcome Aer Lingus into IAG".
"It will remain an iconic Irish brand with its base and management team in Ireland but will now grow as part of a strong, profitable airline group. This means new routes and more jobs benefitting customers, employees and the Irish economy and tourism," he said.
IAG now controls more than 95pc of Aer Lingus and any Aer Lingus shareholders that have not sold their shares yet have until September 1 to do so.
IAG's bid of €1.4bn means Aer Lingus investors will receive a payout worth €2.50 per share. They have already received a dividend of 5c also. According to IAG, shareholders who had accepted the deal by today will receive payment for their shares no later than September 1.
As part of the deal, Aer Lingus will now start the process of removing itself from the Irish Stock Exchange. The shares are to be delisted by September 17.
The agreement effectively brings to an end a takeover saga that has gone on for nine months. In December last year, it was revealed that Aer Lingus had rejected a €1.23bn offer from IAG for the airline. IAG came back with a €1.28bn offer which was also rejected. By the end of January, IAG had upped its bid to €1.36bn, which the Aer Lingus board accepted.
That was only the start of the saga, however. The Government said it would not sell the State's 25pc stake in Aer Lingus unless it had "cast iron" guarantees about the future of the airline and its valuable landing slots at Heathrow Airport. In response, Mr Walsh said he would give "legally binding" guarantees for the next five years. The Government ultimately accepted the IAG offer.