Monday 21 May 2018

Richard Branson: Sale of Aer Lingus to IAG was a 'sad day'

Sir Richard Branson, founder of Virgin Group
Sir Richard Branson, founder of Virgin Group
John Mulligan

John Mulligan

The sale of Aer Lingus to British Airways owner IAG was a "sad day", according to Virgin boss Richard Branson.

Speaking to the Irish Independent, Mr Branson, who founded and controls Virgin Atlantic, said that his airline will work with the European Commission to ensure that competition concessions imposed on IAG to allow the Aer Lingus acquisition to go ahead are implemented and adhered to.

IAG, headed by former Aer Lingus and British Airways boss Willie Walsh, paid €1.36bn this year to buy the Irish airline.

British Airways and Virgin have been bitter rivals for over two decade.

"It was a sad day I think when Aer Lingus lost its independence," said the billionaire businessman, who was in Dublin yesterday for the rebranding of TV, broadband and telephone group UPC as Virgin Media. The name change takes effect on Monday.

"It's happened. So now we are working with the European Union to try to make sure that the Aer Lingus arrangement is not too anti-competitive, and we'll see how those negotiations go," added Mr Branson.

"For some bizarre reason, governments have allowed lots and lots of mergers to take place," he said. "I don't think that's in the interest of the travelling public. I think the travelling public benefit from lots of competition."

Virgin Atlantic wrote to the European Commission in April, pleading with it to carefully consider allowing the Aer Lingus sale to IAG. It claimed the takeover would result in a "reduction in competition" which would result in a "deterioration in consumer benefit".

Virgin Atlantic, 49pc-owned by US carrier Delta, was concerned that it would lose tens thousands of passengers who connect to its long-haul services in London from Ireland.

Almost 60,000 passengers travelled on Aer Lingus flights from Ireland last year to connect with a long-haul Virgin Atlantic flight at London Heathrow, compared to around 10,500 passengers from British Airways. Virgin Atlantic also handled over 50,000 feed passengers at London Gatwick from Aer Lingus last year.

"IAG made public promises," Mr Branson said yesterday. "We'd like the European Commission to make sure those public promises are put in writing so that we can trust those promises."

IAG has already had to give those binding undertakings to the European Commission, and to the Government, which agreed in May to sell its 25.1pc stake in Aer Lingus to IAG.

Yesterday, the UK's Competition and Markets Authority (CMA) said that following the IAG takeover, Ryanair has now formally dropped an appeal to a CMA ruling earlier this year that instructed the airline to sell most of its Aer Lingus stake on competition grounds.

Irish Independent

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