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Order HereIrish low-cost carrier Ryanair could be forced to sell or reduce its 29.8% stake in Aer Lingus after UK Competition Commission (CC) provisionally ruled it could reduce competition between Great Britain and the Republic of Ireland. …
Budget airline Ryanair may have to sell its entire stake in Aer Lingus after the Competition Commission said it could reduce competition.
In a preliminary ruling, the commission said Ryanair’s near 30% holding was likely to weaken its main rival on routes between Britain and the Republic of Ireland.
The decision will provide yet another obstacle to Ryanair’s attempt to acquire Aer Lingus following the rejection of its third takeover bid by European officials in February.
Ryanair hit back on Thursday, saying the commission’s decision was in breach of EU law because it failed to corroborate the European commission’s findings in February that competition between the companies had intensified since 2007. Chief executive Michael O’Leary said: “This provisional decision is bizarre and manifestly wrong.”
The company plans to take the case to the UK Competition Appeals Tribunal, if the commission’s final decision in July rules against it.
Ryanair initially bought its stake in Aer Lingus in 2006 and subsequently launched a bid for the entire company, which the EC blocked. The company has been in embroiled in investigations and appeals with the EC, the Office of Fair Trading and the Competition Commission ever since.
On Thursday, the Competition Commission said Ryanair’s minority stake meant it could influence strategy at one of its main competitors. This could prove problematic if Aer Lingus wanted to team up with another airline, raise capital or sell its valuable slots at London’s Heathrow Airport, it added.
“We were particularly concerned about Ryanair’s influence over Aer Lingus’s ability to be acquired by, merge with, or acquire another airline,” said Simon Polito, deputy chairman of the commission. “We thought it likely that such a combination would be necessary to increase Aer Lingus’s scale and achieve synergies to allow it to remain competitive in future.”
The commission said one effective remedy to the “substantial lessening of competition” would be to sell the entire 29.8% stake. It is seeking views on other remedies, such as Ryanair selling part of that stake, or so-called behavioural remedies, such as limiting its voting rights.
Ryanair argued that the issue should be of no interest to the Competition Commission as Aer Lingus accounts for less than 1% of the UK’s total air traffic and therefore the case has “little if any impact on UK consumers”.
O’Leary said: “UK taxpayer interests would be better served if the UK Competition Commission investigated (rather than ignored) BA’s recent takeovers of BMI, Iberia and Vueling, instead of wasting time pursuing this Irish case, which is of no consequence to UK consumers.”
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Order HereIrish low-cost carrier Ryanair could be forced to sell or reduce its 29.8% stake in Aer Lingus after UK Competition Commission (CC) provisionally ruled it could reduce competition between Great Britain and the Republic of Ireland. …
Budget airline Ryanair may have to sell its entire stake in Aer Lingus after the Competition Commission said it could reduce competition.
In a preliminary ruling, the commission said Ryanair’s near 30% holding was likely to weaken its main rival on routes between Britain and the Republic of Ireland.
The decision will provide yet another obstacle to Ryanair’s attempt to acquire Aer Lingus following the rejection of its third takeover bid by European officials in February.
Ryanair hit back on Thursday, saying the commission’s decision was in breach of EU law because it failed to corroborate the European commission’s findings in February that competition between the companies had intensified since 2007. Chief executive Michael O’Leary said: “This provisional decision is bizarre and manifestly wrong.”
The company plans to take the case to the UK Competition Appeals Tribunal, if the commission’s final decision in July rules against it.
Ryanair initially bought its stake in Aer Lingus in 2006 and subsequently launched a bid for the entire company, which the EC blocked. The company has been in embroiled in investigations and appeals with the EC, the Office of Fair Trading and the Competition Commission ever since.
On Thursday, the Competition Commission said Ryanair’s minority stake meant it could influence strategy at one of its main competitors. This could prove problematic if Aer Lingus wanted to team up with another airline, raise capital or sell its valuable slots at London’s Heathrow Airport, it added.
“We were particularly concerned about Ryanair’s influence over Aer Lingus’s ability to be acquired by, merge with, or acquire another airline,” said Simon Polito, deputy chairman of the commission. “We thought it likely that such a combination would be necessary to increase Aer Lingus’s scale and achieve synergies to allow it to remain competitive in future.”
The commission said one effective remedy to the “substantial lessening of competition” would be to sell the entire 29.8% stake. It is seeking views on other remedies, such as Ryanair selling part of that stake, or so-called behavioural remedies, such as limiting its voting rights.
Ryanair argued that the issue should be of no interest to the Competition Commission as Aer Lingus accounts for less than 1% of the UK’s total air traffic and therefore the case has “little if any impact on UK consumers”.
O’Leary said: “UK taxpayer interests would be better served if the UK Competition Commission investigated (rather than ignored) BA’s recent takeovers of BMI, Iberia and Vueling, instead of wasting time pursuing this Irish case, which is of no consequence to UK consumers.”
The information on this page may have been provided by a contributor and no guarantees can be made about the accuracy of any content. Contributors must obtain all necessary licenses and/or ownership rights from the relevant content owner(s) before submitting the same for publication. AIRLINE PARTNERSHIP disclaims all liability arising from the publication of content received from contributors. Please refer to our Disclaimer for more details.
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Order HereIrish low-cost carrier Ryanair could be forced to sell or reduce its 29.8% stake in Aer Lingus after UK Competition Commission (CC) provisionally ruled it could reduce competition between Great Britain and the Republic of Ireland. …
Budget airline Ryanair may have to sell its entire stake in Aer Lingus after the Competition Commission said it could reduce competition.
In a preliminary ruling, the commission said Ryanair’s near 30% holding was likely to weaken its main rival on routes between Britain and the Republic of Ireland.
The decision will provide yet another obstacle to Ryanair’s attempt to acquire Aer Lingus following the rejection of its third takeover bid by European officials in February.
Ryanair hit back on Thursday, saying the commission’s decision was in breach of EU law because it failed to corroborate the European commission’s findings in February that competition between the companies had intensified since 2007. Chief executive Michael O’Leary said: “This provisional decision is bizarre and manifestly wrong.”
The company plans to take the case to the UK Competition Appeals Tribunal, if the commission’s final decision in July rules against it.
Ryanair initially bought its stake in Aer Lingus in 2006 and subsequently launched a bid for the entire company, which the EC blocked. The company has been in embroiled in investigations and appeals with the EC, the Office of Fair Trading and the Competition Commission ever since.
On Thursday, the Competition Commission said Ryanair’s minority stake meant it could influence strategy at one of its main competitors. This could prove problematic if Aer Lingus wanted to team up with another airline, raise capital or sell its valuable slots at London’s Heathrow Airport, it added.
“We were particularly concerned about Ryanair’s influence over Aer Lingus’s ability to be acquired by, merge with, or acquire another airline,” said Simon Polito, deputy chairman of the commission. “We thought it likely that such a combination would be necessary to increase Aer Lingus’s scale and achieve synergies to allow it to remain competitive in future.”
The commission said one effective remedy to the “substantial lessening of competition” would be to sell the entire 29.8% stake. It is seeking views on other remedies, such as Ryanair selling part of that stake, or so-called behavioural remedies, such as limiting its voting rights.
Ryanair argued that the issue should be of no interest to the Competition Commission as Aer Lingus accounts for less than 1% of the UK’s total air traffic and therefore the case has “little if any impact on UK consumers”.
O’Leary said: “UK taxpayer interests would be better served if the UK Competition Commission investigated (rather than ignored) BA’s recent takeovers of BMI, Iberia and Vueling, instead of wasting time pursuing this Irish case, which is of no consequence to UK consumers.”
The information on this page may have been provided by a contributor and no guarantees can be made about the accuracy of any content. Contributors must obtain all necessary licenses and/or ownership rights from the relevant content owner(s) before submitting the same for publication. AIRLINE PARTNERSHIP disclaims all liability arising from the publication of content received from contributors. Please refer to our Disclaimer for more details.