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Turbulence hits airline industry

Published 01/08/2012

Machinations in the airline industry in Ireland north and south have made it the most fascinating sector of any to watch.

The Republic of Ireland has sent forth unto the airline world two of its most dominant figures, Ryanair's Michael O'Leary and Willie Walsh of British Airways. The latter made his name as a formidable airline chief at Aer Lingus.

In Northern Ireland we have seen the departure of BMI and bmi baby, and the former replaced by British Airways, which bought BMI in a £172.5m deal but divested itself of the unloved sister company.

Now a battle between Ryanair and Aer Lingus has reached a more intense phase, as the relative newcomer gears up for its third takeover bid for the 70% stake in Aer Lingus it doesn't already own.

Aer Lingus delivered its rejection of the offer in a 30-page circular sent to shareholders, claiming a €1.30 per share offer undervalues the business and would be anti-competitive.

The longer-established airline will shift its Belfast operations from the International Airport to George Best Belfast City in the autumn, where it will compete on the Heathrow link with British Airways.

But if Ryanair gets its way with Aer Lingus, that could mean a return to Belfast for the self-styled 'world's favourite airline' after it pulled out in a row over a runway extension two years ago.

We'll all be watching closely.

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