Belfast Telegraph

Ryanair turns up heat in hangar HQ stand-off

BY John Mulligan

Ryanaire boss Michael O'Leary has said he plans to move the company's headquarters to hangar 6 in Dublin Airport if he gains control of the facility — but he has denied that was his sole reason for seeking the premises last year.

Mr O'Leary told the Irish Independent that if it wasn't for Ireland's low corporate tax rate, he would now consider moving the airline's headquarters out of the country.

A political row has broken out in the Republic over Ryanair's wish to occupy the hangar and create 500 jobs in aircraft maintenance — and what it claims is the failure of the Irish government to help it do so. The airline wanted Dublin Airport and the government to force national carrier Aer Lingus out of the hangar so that it could start its own maintenance business, creating hundreds of jobs. Instead it has said it will build a second maintenance hangar at Prestwick Airport, creating up to 200 jobs

Despite controversy a number of years ago regarding significant rent breaks received from Aer Rianta and subsequently the Dublin Airport Authority (DAA) for its current headquarters, Mr O'Leary yesterday said that these were a means to allow the money spent constructing the building to be recouped.

A company called Darley Investments, which was originally wholly controlled by a trust fund established for the benefit of the sons of Ryanair founder Tony Ryan, built the current Ryanair headquarters at the airport using an estimated £2.5m (€3.2m) loan from the airline.

The site of the headquarters was leased by Darley Investments from the Department of Transport through Aer Rianta for 30 years at a cost of £192,000 (€244,000) a year.

That site rent was not payable at all for the first 12 years, while just 50% was payable for the next six years until 2008. Mr O'Leary said Ryanair is now paying the full yearly rent of €244,000 to the DAA.

He maintained that ownership of the building was transferred to the airport authority from the time it was first occupied, and that the rent deal allowed Ryanair to claw back construction costs.

Clarification of the transfer of the building was not available from the DAA yesterday evening.

But sets of Ryanair's own accounts note that the airline rented the headquarters from Darley Investments for £200,000 (€254,000) a year from 1992 until mid-1996, when Darley was still controlled by the Ryan family trust.

Darley became a wholly-owned subsidiary of Ryanair in 1996. As far back as 1999, the building was being carried on Ryanair's balance sheet as a fixed asset with a net book value of £958,000 (€1.2m).

Mr O'Leary said yesterday that if a new hangar without attached office space was constructed for its use at Dublin Airport, the airline would not want to occupy it.

Belfast Telegraph