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European court ends Ryanair's bid to take over rival Aer Lingus

RYANAIR will not be allowed to take over Aer Lingus, a court ruled today.

The European Court of Justice said Michael O'Leary's takeover bid of the national airline was anti-competitive.

However, the court also decided that Ryanair can hold on to its 29.9pc stake in Aer Lingus.

Ryanair acquired a 19pc stake in Aer Lingus after the national carrier was privatised in 2006 and then notified the European Commission it was seeking a takeover.

By the end of 2006, Ryanair had upped its stake in Aer Lingus to 25pc.

However, in June 2007 the commission declared a takeover bid incompatible with EU competition rules.

Ryanair challenged that decision and in the meantime brought its shareholding up to 29.9pc.

Bids

Today's ruling looked at whether Ryanair should have been able to take over Aer Lingus. Ryanair is now unlikely to make any further bids for Aer Lingus.

Had the ruling gone in the budget carrier's favour, it would have opened the way for it to make a third bid for Aer Lingus.

The takeover bid was the only proposed airline merger to be blocked by the commission before or since. Aer Lingus argued the commission should have gone further and forced Ryanair to sell its stake once it ruled out the takeover bid.

The commission said it did not have the legal authority to do this, but Aer Lingus argued EU merger regulations permit such a move.

Prior to today's ruling, Ryanair boss Michael O'Leary told the Financial Times: "We would have no immediate plans to launch a bid for Aer Lingus. We have said there's no point in us doing it until the government decides to sell."

comurphy@herald.ie


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