Aer Lingus shares tumble as takeover opposition grows
Shares in Aer Lingus have slumped as a growing wave of political and business opposition to a €1.4bn takeover of the airline by IAG gains momentum.
They closed yesterday on the stock market below the level that IAG made its first approach to buy Aer Lingus before Christmas.
Shareholders are now fretting that a deal could be derailed before it's even formally made.
Taoiseach Enda Kenny said yesterday that the government has to considered the "broader sense of impact of what's involved" if a sale goes through.
He said it had to assess job opportunities and connectivity in making a decision on whether or not to see its 25.1% stake in the airline.
A union representing 500 pilots at Aer Lingus told TDs and Senators yesterday that its members opposed a deal and that a takeover "is not good" for the pilots or their families.
Evan Cullen, the president of the Irish Airline Pilots' Association (IALPA) said that its members owned about 7% of the airline, via 2.5% that's held in a pension scheme, another stake that's held in a vehicle originally established to try and thwart a previous Ryanair takeover approach, and other shares held directly by pilots.
Mr Cullen said the union had not been contacted regarding the takeover approach. He and other union and business representatives were addressing the joint Oireachtas Committee on Transport and Communications yesterday.
Politicians were told by unions that any guarantees obtained by the government from IAG regarding Aer Lingus slots or the airline's operations would be worthless once the government stake was sold.
"It is an absolute nonsense for anyone to suggest that (the government) can put legally-binding constraints on the owner when they get their cheque for the shares - it just doesn't happen," Mr Cullen said.
Aer Lingus shares tumbled nearly 6% to €2.23 (£1.70).