Ryanair, an Ireland-based no-frills airline, has had its latest attempt to buy out Ireland-based carrier Aer Lingus refused by the European Commission (EC).
The EC has again blocked the deal, ruling that Ryanair’s proposed solutions to previous objections raised by the Commission are, ‘inadequate.’ Ryanair’s response to the decision has been swift and scathing, describing it as, ‘a political decision to pander to the vested interests of the Irish government.’
The comment refers to the fact that the government in the Irish Republic owns a 25 percent stake in Aer Lingus, and does not want the budget carrier to take control of the company.
The ruling means that Ryanair’s third attempt in six years to complete a EUR694 million deal for Aer Lingus has again been thwarted, with the EC still concerned over possible monopolies that the combined entity would wield. This was despite Ryanair proposing to pay budget carrier, Flybe, to operate 43 of the routes currently flown by Aer Lingus, and to provide slots at Heathrow to British Airways owner, IAG, as part of which, BA would operate three routes between the UK and the Irish Republic for three years. However, the EC ruled that neither the involvement of Flybe or British Airways in a new allocation of routes would stop Ryanair from gaining a monopoly or dominant position on 46 routes where it currently had competition from Aer Lingus.
The EC said, ‘The remedies proposed fell short of addressing the competition concerns,’ adding, ‘Customers’ options would have been substantially reduced . . . Higher prices would have been the likely outcome.’
Ryanair said that the refusal of its ‘historic and unprecedented’ concessions package was ‘manifestly unjust.’