Sep 28, 2016, 2:57 pm
Last edit by: JDiver
Aer Lingus takeover by IAG
Executive summary: Rumours of IAG (International Consolidated Airlines Group, British Airways, IAG Cargo, Iberia and Vueling - Link to Wikipedia article) interest in acquiring EI strengthened in December 2014, with refusals and objections by then 29% owner Ryanair, EI Board of Directors and some Irish government leaders (a 25% stake was held by the Irish government).
Aer Lingus, currently headed by CEO Stephen Kavanagh, was acquired by IAG for €1.36bn in 2015; IAG took full control of Aer Lingus on 02 Sep 2015.
Aer Lingus is working to join the oneworld airline alliance and plans to expand service to the U.S. later this year and next, CEO Stephen Kavanagh said Wednesday.
...Aer Lingus will strive to join the oneworld alliance that counts British Airways and American Airlines among its founding members.
“There are some advantages to joining the big-boys’ club,” Kavanagh said. While Avios will be a competitive tool, “ultimately, we believe that will result in our joining again oneworld,” he said.
Link to USA Today article - 18 May 2016
...Aer Lingus will strive to join the oneworld alliance that counts British Airways and American Airlines among its founding members.
“There are some advantages to joining the big-boys’ club,” Kavanagh said. While Avios will be a competitive tool, “ultimately, we believe that will result in our joining again oneworld,” he said.
Link to USA Today article - 18 May 2016
Aer Lingus is on target to join the OneWorld alliance next year (2017), when it should also be able to benefit from BA's joint venture with American Airlines.
"The next big integration issue will be Aer Lingus coming into the joint business on the transatlantic. That will require some systems changes," said (IAG CEO) Mr Walsh.
Link to article in Independent - 30 Apr 2016
"The next big integration issue will be Aer Lingus coming into the joint business on the transatlantic. That will require some systems changes," said (IAG CEO) Mr Walsh.
Link to article in Independent - 30 Apr 2016
On 26 May 2015, after months of negotiations on a possible IAG takeover, the Irish government agreed to sell its 25% stake in the company. Ryanair retained a 30% stake in Aer Lingus which it agreed to sell to IAG on 10 July 2015 for €2.55 per share. In August 2015, Aer Lingus' shareholders officially accepted IAG's takeover offer. IAG subsequently assumed control of Aer Lingus on 2 September 2015.
Link to Wikipedia article about Aer Lingus
Link to Wikipedia article about Aer Lingus
Aer Lingus IAG take over bid [Master Thread]
Dec 26, 2014, 6:44 am
#16
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Dec 27, 2014, 12:44 pm
#17
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Vueling is a LCC funneling mostly tourists to Spain. Aer Lingus is a regular airline and flag carrier with a long-haul business focused on North America and also a significant link-up with various UK destinations. I don't think it's really comparable. (Let's not argue about the blurring line between regular airlines and LCC)
Given that LHR's expansion seems to be on ice for the foreseeable future, DUB could be a useful secondary hub to funnel OW's TATL passengers onward into the UK/EU network.
Given that LHR's expansion seems to be on ice for the foreseeable future, DUB could be a useful secondary hub to funnel OW's TATL passengers onward into the UK/EU network.
Dec 29, 2014, 11:27 am
#18
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A BA takeover would probably mean joining OneWorld, wouldn't it? And with that it's inevitable that the current codesharing agreements with non-OW airlines for example KLM in Europe and UA and Jetblue in the U.S. would be toast as well (i.e. onward travel in the U.S. from Aer Lingus flights would be with AA only). And in Europe you wonder how it would affect a flight like ORK-AMS which to some extent lives off Amsterdam's hub capabilities toward the rest of Europe, Asia and Africa. It would probably make sense to cut it then and replace it with an additional flight to LHR.
They may wish EI to join, but the costs of membership were what caused EI to drop out in 2004. I doubt that has changed, or would change, and EI is free to deal with whatever airlines it likes, which makes more sense for it. I'm sure it's something that will be looked at, but it may not make much sense for IAG to force EI into oneworld.
As regards KLM, I doubt they would ditch the ORK-AMS codeshares; AF codeshares with AY on CDG-HEL, for instance; I can't see KLM or AF starting services to ORK (maybe this might spur KLM to look at Dublin, but I doubt it would actually change anything as regards their EI cooperation, regardless of whether EI joined oneworld or not).
Remember that KLM happily codeshared on EI back when EI was in oneworld.
And I doubt that EI would cut ORK-AMS if the KL deal ended. It's not totally there to serve KLM, and it's not only KLM that benefits from connecting traffic on the route (I flew the route this morning, and of my immediate neighbours whose itineraries and boarding passes I saw, the connections were onto Delta and onto Malaysia Airlines, not KLM). The route also attracts customers from not just the Netherlands, but Germany and Belgium (ORK-BRU has been scrapped) too.
Last edited by irishguy28; Dec 29, 2014 at 11:33 am
Dec 29, 2014, 2:18 pm
#19
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Well yes and no. It would depend on what IAG wanted. For the model that EI is with a TATL product with J Class it might make sense compared to the Vueling model which is really not comparable to the EI model apart from its UK/Europe operations. The TATL difference might be the key in answering this question. Also EI has kept its relationship with former OW members so again another factor but that of course does not mean automatic OW membership in itself.
Dec 29, 2014, 9:06 pm
#20
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I wonder if the IAG bid will spark interest from any other airlines.
I think that EI would be a really nice fit for VS. In someway, I think EI would be a better fit for VS than for BA. With little red winding down, EI would give VS access to the UK transatlantic market outside of London. VS might be able to squeeze a few more slots for TATL from LHR out of the deal too.
I think an EI-VS match-up would also be much more palatable to government regulators from a competitive standpoint. I don't know if O'Leary would like this much.
I think that EI would be a really nice fit for VS. In someway, I think EI would be a better fit for VS than for BA. With little red winding down, EI would give VS access to the UK transatlantic market outside of London. VS might be able to squeeze a few more slots for TATL from LHR out of the deal too.
I think an EI-VS match-up would also be much more palatable to government regulators from a competitive standpoint. I don't know if O'Leary would like this much.
Dec 30, 2014, 1:49 am
#21
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Well,VS has been the plaything of several owners, and is now 49% owned by Delta. I don't really think that VS is an entity that ever looked, or will look, to take stakes in other airlines [except bmi], and I don't think that VS's owners are or would be interested in EI.
On Christmas Eve, IAG took a tiny shareholding in EI, as reported yesterday by Reuters, so I think IAG is far and away the most likely buyer. Recent news will flush out any interested buyers, I'm sure, but things are looking like IAG definitely have the upper hand.
On Christmas Eve, IAG took a tiny shareholding in EI, as reported yesterday by Reuters, so I think IAG is far and away the most likely buyer. Recent news will flush out any interested buyers, I'm sure, but things are looking like IAG definitely have the upper hand.
Last edited by irishguy28; Dec 30, 2014 at 2:02 am
Dec 30, 2014, 12:24 pm
#22
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Oh please god NOOOOO !!! It would be a disaster. You may as well shut the airline down. Id rather see the airline go back to Irish state control than go into the grubby hands of SRB. ( Of course under EU rules that would not be possible ) so I think IAG has a better track record.
Dec 31, 2014, 1:49 pm
#23
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On Christmas Eve, IAG took a tiny shareholding in EI, as reported yesterday by Reuters, so I think IAG is far and away the most likely buyer. Recent news will flush out any interested buyers, I'm sure, but things are looking like IAG definitely have the upper hand.
Dec 31, 2014, 4:56 pm
#24
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In the long run I agree that VS will not go afer EI. They are far too busy figuring out what their strategy is since the Delta acquisition.
The IAG stock acquisition is a very interesting development. I am impressed how quiet it was kept. I wonder if IAG will acquire as much as they can on the open market. Knowing that that the Government and Ryanair portion are out of play for the time being, I wonder if IAG could even pick up a meaningful percentage of the company.
If Ryanair are forced to divest by a certain date, could IAG spimply wait them out rather than paying a premium?
The IAG stock acquisition is a very interesting development. I am impressed how quiet it was kept. I wonder if IAG will acquire as much as they can on the open market. Knowing that that the Government and Ryanair portion are out of play for the time being, I wonder if IAG could even pick up a meaningful percentage of the company.
If Ryanair are forced to divest by a certain date, could IAG spimply wait them out rather than paying a premium?
Jan 6, 2015, 8:03 am
#25
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IAG acquired another 7,000 shares in EI yesterday, via Goodbodys.
Jan 9, 2015, 12:18 pm
#26
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Aer Lingus rejects second approach from IAG
International Airlines Group (IAG) this evening confirmed that it has submitted a revised proposal to make an offer for Aer Lingus.
The new bid - which was made on December 29 - has been rejected by the board of Aer Lingus, AIG said.
Shares in Aer Lingus closed 10% higher in Dublin this evening on speculation of a new bid.
http://www.rte.ie/news/business/2015...er-lingus-iag/
International Airlines Group (IAG) this evening confirmed that it has submitted a revised proposal to make an offer for Aer Lingus.
The new bid - which was made on December 29 - has been rejected by the board of Aer Lingus, AIG said.
Shares in Aer Lingus closed 10% higher in Dublin this evening on speculation of a new bid.
http://www.rte.ie/news/business/2015...er-lingus-iag/
Jan 9, 2015, 4:19 pm
#27
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Interesting news. I do think this deal will eventually will happen. I just wonder at what price and at what ownership percentage. Also, will we have to wait until O'Leary is forced to sell.
Jan 10, 2015, 7:34 am
#28
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Well, the UK appeal on the CMA decision to force Ryanair to sell down to 5% is overdue. After that, it would depend on whether Ryanair appeals to a higher (European) court but most analysts feel that Ryanair are ready to sell. There could be a flurry of activity if, as expected, Ryanair makes no further appeals.
The downturn in December passenger numbers on EI will give IAG some pause for thought. Perhaps that's already why the second offer was only increased by 10 cents. They also stated that there is no guarantee of any further offers.
We'll know soon enough, I guess.
The downturn in December passenger numbers on EI will give IAG some pause for thought. Perhaps that's already why the second offer was only increased by 10 cents. They also stated that there is no guarantee of any further offers.
We'll know soon enough, I guess.
Jan 10, 2015, 11:53 am
#29
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They should take it while they can. Its the only option open to make Aer Lingus reach its full potential within a strong group of airlines. Id say MOL will be up for selling to IAG at the right price as if forced to he doesn't have such a bad relationship with WW despite the off the cuff comments.