British Airways owner set to buy Aer Lingus
British Airways owner International Airlines Group (IAG) looks set to take over Aer Lingus after the Irish Government gave the go-ahead to a €1.4bn (£1.03bn) bid.
The Irish Government, which owns a 25% stake in the national flag carrier, now supports the proposed deal after seeking reassurances and commitments.
Irish laws mean the Dail will now have to vote to back the proposals.
IAG said it has agreed to several "legally binding" promises on the future of Aer Lingus, including the development of Dublin as a hub for transatlantic routes.
It has also vowed that Aer Lingus will keep existing slots at Heathrow, continue routes between Heathrow and Dublin, Cork and Shannon for the next seven years, as well as retaining its corporate brand. The Aer Lingus head office will stay in Dublin under the agreement.
Willie Walsh, the Irish-born chief executive of IAG, claimed Aer Lingus, Ireland and IAG would all benefit from the deal.
"Aer Lingus would maintain control of its brand and operation while gaining strength as part of a profitable and sustainable airline group in an industry that's consolidating," he said.