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Government accepts IAG takeover of Aer Lingus

Published 16/07/2015

Aer Lingus will continue to carry connecting passengers to the long-haul flights of competing airlines
Aer Lingus will continue to carry connecting passengers to the long-haul flights of competing airlines

The Government has formally accepted the International Airlines Group's takeover of Aer Lingus as the 5pm deadline passed.

After shareholders in the flag carrier gave the 1.3 billion euro deal the green light, Transport Minister Paschal Donohoe described the sale as a landmark day for the airline and Irish aviation.

"IAG has set out ambitious growth plans for the company under its ownership and I am excited at the prospects that this deal offers for Aer Lingus," he said.

"I look forward to completion of the deal and to supporting Aer Lingus in its future development, which I am confident will see it continue to proudly and effectively serve Ireland, our people and our economy."

In an extraordinary general meeting, Aer Lingus shareholders passed four resolutions - including two on connectivity guarantees - to clear the path for a takeover which has not been without opposition from unions and some politicians based around regional airports.

IAG, the owner of British Airways, is paying 2.55 euro a share for Aer Lingus.

The Government, a 25.1% shareholder in the Irish airline, lodged the necessary documentation for the sale this evening.

It is expected to be finalised in the autumn after the European Commission also approved the proposed acquisition earlier this week and Ryanair also agreed to sell its 29.8% stake.

Michael O'Leary's low-fares carrier had made unsuccessful attempts to buy Aer Lingus.

Under the agreement IAG will increase transatlantic services in and out of Ireland by its new Irish subsidiary while five daily landing slots at London Gatwick will have to be given up by the global airline giant under a European Commission direction.

Aer Lingus will also continue to carry connecting passengers to the long-haul flights of competing airlines.

Mr Donohoe said concerns expressed over jobs and connectivity in and out of Ireland were answered in negotiations with IAG.

"I secured important guarantees for the Government in respect of Ireland's future connectivity, particularly to London Heathrow, and on the maintenance of Aer Lingus's iconic brand and ensuring that Aer Lingus's head office will remain in Ireland," he said.

"These have now been given legal effect through the passing of the resolutions."

IAG later said it was extending the deadline for shareholders to accept its takeover to 1pm on July 30.

A spokeswoman said the airline group was exercising an option to push out the final date and that it would give an update on the acceptance rate of shareholders "in due course".

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