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Government Agrees IAG’s €1.36b Aer Lingus Takeover, But Questions and Controversy Remain.

The Government this week accepted International Airlines Group (ING)’s take-over bid of the national airline, following the Aer Lingus Board’s approval of the deal earlier in January.  ING, the parent company of British Airways, Iberia, and Vueling, and the sixth largest airline company in the world, had previously made two bids which were rejected.  The success of the latest offer comes on the back of assurances from ING that Aer Lingus would maintain its existing slots between Heathrow and Dublin, Cork, and Shannon, for at least 7 years.  As a result of these and other assurances regarding jobs, the Government has agreed to sell it’s 25% stake in the company.   Willie Walsh, IAG’s Irish-born chief executive, insisted that the proposed sale would be mutually beneficial to all parties:  “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.”  Transport Minister Paschal Donahue indicated that job creation assurances had also been made, with the hope of generating up to 635 new jobs by the end of next year.

International Airlines Group Chief Executive Willie Walsh.

The proposed sale remains hugely controversial among opposition parties and some union leaders, however.  The release of an internal analysis, commissioned by Aer Lingus and conducted by consultants Nyras, has lead to renewed claims that job losses may be eminent for the airline.  The Nyras report proposes “aggressive but achievable” targets to achieve €60 million in reduced costs.  Meanwhile, SIPTU president Jack O’Conner has also expressed a note of caution, suggesting that his members had “serious concerns” that the deal might lead to outsourcing of jobs.


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