Ryanair to buy Aer Lingus!

okidoki987

Ryanair have bought 16% of Aer Lingus and have offered 2.80 :eek:
per share to buy the rest of the company.
MOL you're some man
Waiting to see the next Ryanair add.

stepbar

What a **** you to the government I dont think it will happen, the competition authority will block it

dunkamania

i dont think this is a good move for Ryanair,it will make them less competitive as a firm

okidoki987

Shares now 2.81 Euro.
MOL is up 11% on the 16% stake he has already built up :eek:

stepbar

O leary knows that the gov / competition authority will block the bid. As I said the bid is a **** you to the government, I dont think he is really serious

Victor

okidoki987 wrote:

Shares now 2.81 Euro. MOL is up 11% on the 16% stake he has already built up :eek:

He can't turn that into profit though, there are rules about manipulating markets like that.

rondjon

stepbar wrote:

O leary knows that the gov / competition authority will block the bid.

O'Leary seemed quite confident this morning on the radio that a) the Competition Authority here in Ireland won't even be able to make a ruling on this and b) that the European competition authority (whatever that is) will approve the takeover based on precedents other European countries.

okidoki987

He can't turn that into profit though, there are rules about manipulating markets like that

True but if someone else enters the frame.......

i71jskz5xu42pb

okidoki987 wrote:

MOL is up 11% on the 16% stake he has already built up :eek:

He didn't actually buy 16%. He had the rights on 16% if the offer was accepted. Big difference.

The government have just said they are not selling so that's that. Time to put everything back in it's box.

ShiverinEskimo

PascalNee wrote:

The government have just said they are not selling so that's that. Time to put everything back in it's box.

Link?

I watched the dail on TG4 this morning and all the government decided was that it needed to be investigate further in association with the competition authority. As far as I'm concerned no decision has been made in regards to not selling to MOL/Ryanair.

i71jskz5xu42pb

ShiverinEskimo wrote:

As far as I'm concerned no decision has been made in regards to not selling to MOL/Ryanair.

As far as the government is concerned a decision has been made

A quick google search will get you the link.
http://news.google.ie/news?hl=en&q=ryanair%20government&btnG=Search&sa=N&tab=wn

ShiverinEskimo

Fair enough - I stand corrected - All I heard from bertie was investigate/look into etc.

rondjon

PaschalNee wrote:

He didn't actually buy 16%. He had the rights on 16% if the offer was accepted. Big difference.

Please explain?


With regards to decisions etc on the offer, the Aer Lingus Board have declined the offer, which really means nothing. They can only recommend to the shareholders not to accept the offer.

However, if Joe Public wants to sell their shares to Ryanair, there's nothing that the board nor the Government can do about that.

The only comment I've seen from the Government is that they're reviewing the offer, but that they foresee some competition issues. Which is all fair enough.

i71jskz5xu42pb

rondjon wrote:

Please explain?

I may be wrong on this but I read somewhere today that Ryanair only had agreed rights on the shares at a certain price. If the deal is does not go though they do not have to actually buy the shares.

Which makes sense - they would have bought ~200 million worth of shares. If the government do not want to sell, these shares may be worth a lot less than 200. Seems like a pretty big risk.

The Ryanair statement talks about acquiring shares - maybe they have bought them, maybe they have acquired the rights. As I said, I may be wrong on this.

rondjon wrote:

The only comment I've seen from the Government is that they're reviewing the offer, but that they foresee some competition issues. Which is all fair enough.

Post above has a link to a Cowen and Cullen (Laurel and Hardy) conference where they say the Government is not selling. Of course they might also be wrong ....

Cute Hoor

Ryanair had bought 16% of AL by this morning, now thought to be closer to 20%. These were bought from Ryanair’s own reserves of €2bn. The Govt can do sweet FA if shareholders sell to MOL, they can hold onto their share (25% I think) for all the influence they will have, and the ESOT can hold onto their 15% but it will not stop MOL getting control (50.1%) of AL which is what he wants.

This would appear to make great sense for Ryanair as they are in essentially different markets, Ryanair shorthaul, with a significant part of AL’s business being long-haul. Shannon & Dublin are the only 2 european airports that have a US immigration centre, this saves US travellers up to 3 hours not having to go through immigration control in the US. Ryanair could fly US bound passengers from all over Europe to Dublin/Shannon hubs to be processed through immigration and flown on by Aer Lingus to their US destinations.

phantom_lord

Unions and opposition parties in Ireland fear a takeover will wipe out competition, drive up prices and lead to job cuts

typical union bs, a ryanair take over would drive up prices?

Blackjack

I believe that Aer Lingus needs to maintain a minimum 51% Irish Ownership in order to retain it's US Landing rights. If Ryanair were to buy, then unless some sort of Holding company were created (not sure if this would even work) then I doubt that %age would be maintained.

Also, Ryanair and Aer Lingus currently only compete on 17 routes - however you need to bear in mind that Ryanair to Glasgow =Prestwick and Aer Lingus to Glasgow = Glasgow Airport, so the competition to the same regions is greater than 17. All of the routes competing would be to and from Ireland, so having competing airlines on these routes is to the consumers benefit.

A combined company would have a number of strengths, specifically in relation to purchasing power, greater economies of scale etc. However, I can't help feeling that AerLingus would be treated in the same manner as Buzz airlines was and be only a bolt-on for landing rights and nothing more.

Personally, as someone who regularly uses both airlines, Ryanair have the edge when it comes to punctuality etc, however Aer Lingus Transatlantic is cheaper than any Airline I've come accross, and their Lounge access and occasional upgrade is a Luxury I would sorely miss.

You have to admire O'Leary's opportunism though - the guy really never misses a trick. If he achieves nothing else from this then he'll have created a huge amount of publicity for himself and the company, it may turn out to be cheaper for him to have paid the corporate financiers than the Marketing teams to get Ryanair's name back in the media.

PhoenixRising

Blackjack wrote:

I believe that Aer Lingus needs to maintain a minimum 51% Irish Ownership in order to retain it's US Landing rights. If Ryanair were to buy, then unless some sort of Holding company were created (not sure if this would even work) then I doubt that %age would be maintained.

Would Ryanair Holdings not satisfy the Irish ownership requirement?

rondjon

PhoenixRising wrote:

Would Ryanair Holdings not satisfy the Irish ownership requirement?

While Ryanair might be Irish based and registered, it is not wholly Irish owned. It is 100% floated on the stock exchange, with no limits on who can own it.

Large chunks of it would be owned in the US via the ADRs which are traded over there.

Looking here, 36% of the company owned by it's top 4 investors is US based.

PDelux

Just wondering if anyone here made any money from this? Its a really good return in a few weeks... kinda like a quick SSIA, put in €10k, get back ~€13k.:)
i didnt buy any shares myself.

phantom_lord

PDelux wrote:

Just wondering if anyone here made any money from this? Its a really good return in a few weeks... kinda like a quick SSIA, put in €10k, get back ~€13k.:)
i didnt buy any shares myself.

I think the opportinity for doing that has passed.

Darragh29

I can't imagine the pilots in Aer Lingus bending over when Michael O' Leary tells them they can no longer charge their mobiles at work, etc. I've some respect for the man (MOL), but his attitude towards Ryanair staff is nothing less than a disgrace and it wouldn't be tolerated in Aer Lingus. The only reason why he gets away with bullying Ryanair staff, leaving aside his obvious business achievements at Ryanair for a minute, is because they don't have a union infrastructure in place, if you try to stand up to Ryanair mangagement if you are being screwed, your colleagues cannot stand up to support you as would happen collectively in Aer Lingus, as any person who openly supported you in Ryanair would be targetted for termination.

The set up with Aer lingus being unionised and O' Leary's well know contempt and hatred of unions or any type of collective voice in the workplace, is a recipe for total failure. It is like the infinite force meets the immovable object. O' Leary probably wants the Aer Lingus pilots to go on strike and then send in Ryanair planes & pilots to provide capacity on new routes...

Idbatterim

Aer Lingus employs 3,475 people, has 8m passengers and a €72m profit. Ryanair has only 3,063 employees, but flies 39m passengers every year and makes a €375m profit. Those figures speak for themselves. "In the event that Mr O'Leary's plans are successful, which looks increasingly likely, he will present his radical job reduction plans on a take-it-or-leave-it basis to the Aer Lingus trade unions. "

f Ryanair had a controlling stake in Aer Lingus it would give it alot of options, as was stated in todays indo, oleary only wants to implement willie walshs original plans for the airline. his take it or leave it offer is great, everyone else here pansies to alot of the unions every need. ahern included, who runs the country? i am so sick of hearing about them, how can they be so inward looking? MOL is what they need in government to get things done and tell alot of the bloodsuckers, self interest groups etc where to f**k off!

Blackjack

it seems some of Ryanair's own investors aren't entirely enamoured with the takeover plan either.

Cork

No - I did not buy shares.

Since Eircom - I have not dabbled in the things.

On the Ryanair move - Aer Lingus was itself largely a monopoly.

It changed people large amounts of money for flights. It was not until Ryanair came along that this changed.

Ryanair has delivered vaue to the Irish public.

While I have concerns about competition - I see merit in the move.

Aer Lingus is a small national carrier - In the airline business - economies of scale would be a big benefit in buying fuel and planes.

Aer Lingus is too small to "go it alone".

gemwol

Ryan Air taking over Aer Lingus would be the best thing to happen in the aviation industry in Ireland and hopefully it happens sooner rather than later.

Shannon in particular would be a big beneficiary. Ireland would become part of a central hub for feeding traffic on to the Aer Lingus Trans Atlantic routes. Ryan Air would be feeding passengers from local airports throughout Europe onto the transatlantic flights with one to two stopovers, a lot of those stop over would be Dublin and Shannon. Passengers love this, obscure airports across Europe giving direct access to the US market in a one ticket/one price based system. The same works in reverse, USA passengers would have access to most parts of Europe again in the same manner. Trans Atlantic passengers through Ireland would exponentiate.

What does this mean for Aer Lingus? It would in most likelihood transform them into the biggest transatlantic carrier in the world. More routes would expand, prices for passengers would drop. Shannon will be the biggest beneficiary, Dublin too, Shannon is working under capacity and plenty of room for expansion. Cork & Knock and the regionals would also benefit, capacity at these airports could absorb new routes from Europe. Ireland would become a huge transport hub between the US & Europe.

RTE, IMPACT, Mannion and the government are scaremongering the public, personal grudges in most cases, it's a disgrace. While they all feel that they will impact the outcome of the proposed takeover they won't. Investment bankers determine the outcome in these cases.

It is not a time for the government to be patriotic in the falsehood that they are doing it to protect the "national interest". They sold something far more important without putting any safeguards in place to protect customers, the backbone infrastructure to the telecommunication industry in Ireland, which if they had put the protections in place, would have prevented 40,000 telephone and broadband customers being switched of without any notice by Eircom during the week.

The Ryan Air / Aer Lingus takeover has to go and will go ahead, it makes perfect sense, its right for the country/jobs, for both airlines and would put Ireland right in the centre of the aviation Industry between USA & Europe. The economic benefit to Ireland is too huge to miss out on. Get behind Ryan Air.

But of course their are alternatives, the Babcok & Brown's off the world or Aeroflop, the sorts that would please RTE, IMPACT, Mannion and the government. The anyone, but O Leary camp.

Blackjack

gemwol wrote:

Ryan Air taking over Aer Lingus would be the best thing to happen in the aviation industry in Ireland and hopefully it happens sooner rather than later.

Shannon in particular would be a big beneficiary. Ireland would become part of a central hub for feeding traffic on to the Aer Lingus Trans Atlantic routes. Ryan Air would be feeding passengers from local airports throughout Europe onto the transatlantic flights with one to two stopovers, a lot of those stop over would be Dublin and Shannon. Passengers love this, obscure airports across Europe giving direct access to the US market in a one ticket/one price based system. The same works in reverse, USA passengers would have access to most parts of Europe again in the same manner. Trans Atlantic passengers through Ireland would exponentiate.

What does this mean for Aer Lingus? It would in most likelihood transform them into the biggest transatlantic carrier in the world. More routes would expand, prices for passengers would drop. Shannon will be the biggest beneficiary, Dublin too, Shannon is working under capacity and plenty of room for expansion. Cork & Knock and the regionals would also benefit, capacity at these airports could absorb new routes from Europe. Ireland would become a huge transport hub between the US & Europe.

RTE, IMPACT, Mannion and the government are scaremongering the public, personal grudges in most cases, it's a disgrace. While they all feel that they will impact the outcome of the proposed takeover they won't. Investment bankers determine the outcome in these cases.

It is not a time for the government to be patriotic in the falsehood that they are doing it to protect the "national interest". They sold something far more important without putting any safeguards in place to protect customers, the backbone infrastructure to the telecommunication industry in Ireland, which if they had put the protections in place, would have prevented 40,000 telephone and broadband customers being switched of without any notice by Eircom during the week.

The Ryan Air / Aer Lingus takeover has to go and will go ahead, it makes perfect sense, its right for the country/jobs, for both airlines and would put Ireland right in the centre of the aviation Industry between USA & Europe. The economic benefit to Ireland is too huge to miss out on. Get behind Ryan Air.

But of course their are alternatives, the Babcok & Brown's off the world or Aeroflop, the sorts that would please RTE, IMPACT, Mannion and the government. The anyone, but O Leary camp.

According to an article in todays Indo (a rag, but anyway) what it would mean for Aer Lingus would be 1000 redundancies. Article can be found here (free registration required).

Cork

Blackjack wrote:

According to an article in todays Indo (a rag, but anyway) what it would mean for Aer Lingus would be 1000 redundancies.

I am sure - increased efficencys would be sought in aer lingus.

This is happening anyway in the industry.

Cute Hoor

Blackjack wrote:

Indo (a rag)

Correct!

Gemwol has got it spot on imho, in the event that the offer is successful (MOL gets 51%).

John Sharman (the offer undervalues Aer Lingus (40% up on last week's price)), and Dermot Mannion's (Aer Lingus are confident that their new found shareholders will stick with them because they like the AL offering (unlikely Dermot if they can turn over a quick 40%)) ramblings over the last couple of days are unbelievanle.

Sharman/Mannion may in fact be on dodgy ground, they may be legally obliged to act in the best interest of their shareholders and may yet be forced to recommend the offer (or an improved one) to the shareholders. If they refuse to recommend the offer, and the share price subsequently collapses, they will have acted against the best interest of the shareholders.

Blackjack

Cute Hoor wrote:

Correct!

Gemwol has got it spot on imho, in the event that the offer is successful (MOL gets 51%).

John Sharman (the offer undervalues Aer Lingus (40% up on last week's price)), and Dermot Mannion's (Aer Lingus are confident that their new found shareholders will stick with them because they like the AL offering (unlikely Dermot if they can turn over a quick 40%)) ramblings over the last couple of days are unbelievanle.

Sharman/Mannion may in fact be on dodgy ground, they may be legally obliged to act in the best interest of their shareholders and may yet be forced to recommend the offer (or an improved one) to the shareholders. If they refuse to recommend the offer, and the share price subsequently collapses, they will have acted against the best interest of the shareholders.

Well even as a shareholder I can't help feeling some compassion for the 1000 odd people that would be made redundant.

BuffyBot

Shannon in particular would be a big beneficiary.

As soon as airlines can get out of stopping there, they will. Aer Lingus transatlantic included