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EC Blocks Ryanair's Take-over Bid For Aer Lingus  
User currently offlineToulouse From Switzerland, joined Apr 2005, 2758 posts, RR: 58
Posted (7 years 3 months 1 week 1 day 11 hours ago) and read 2319 times:

Finally and not really much of a surprise, the European Commission has today blocked Ryanair's bid for Aer Lingus:

EC blocks Ryanair's bid for Aer Lingus
Wednesday, 27 June 2007 11:24
The European Commission has blocked an attempt by Ryanair to acquire Aer Lingus.

It is only the second merger prohibition by the EU executive in four years.

The Commission decided the combination would destroy competition at Dublin Airport where both Ryanair, Europe's biggest budget airline, and Aer Lingus are based.

AdvertisementThe Board of Aer Lingus welcomed the decision, saying it was 'good news for Aer Lingus and for our customers.'

John Sharman, Chairman of Aer Lingus, said: 'the creation of one dominant player out of Ireland, despite the protestations of Ryanair, just cannot be in the interests of consumers.'


Ryanair's Chief Executive, Michael O'Leary, had said that he expected the EC to block the €1.4bn deal on competition grounds.

Ryanair is now expected to take a legal challenge against the decision.

Last October, Michael O'Leary stunned the world of aviation when he announced Ryanair wanted to take over Aer Lingus, and the Government, which had privatised Aer Lingus two weeks earlier, was particularly put out.

But the EU Commission initially found a deal would reduce competition for consumers at Dublin Airport.

In order to appease the Commission, Mr O'Leary offered remedies if allowed to buy Aer Lingus; the airline's Heathrow landing slots would be transferred to British Airways and Air France and slots in Dublin would go to other competitors.

Mr O'Leary said also he would reduce Aer Lingus' short-haul fares and scrap fuel surcharges.

But these remedies do not seem to have satisfied the Commission.

The next issue now is whether Ryanair will be forced to sell its 25% stake in Aer Lingus.


Long live Aer Lingus!
14 replies: All unread, jump to last
 
User currently offlineSandroZRH From Switzerland, joined Feb 2007, 3428 posts, RR: 50
Reply 1, posted (7 years 3 months 1 week 1 day 11 hours ago) and read 2311 times:

Just heard it on the news.

Thank god for that!


User currently offlineEI321 From Iraq, joined Jul 2009, 0 posts, RR: 0
Reply 2, posted (7 years 3 months 1 week 1 day 11 hours ago) and read 2298 times:

I dont think this ever had a serious chance of succeeding.

User currently offlineDanny From Poland, joined Apr 2002, 3509 posts, RR: 2
Reply 3, posted (7 years 3 months 1 week 1 day 10 hours ago) and read 2267 times:

Quoting EI321 (Reply 2):
I dont think this ever had a serious chance of succeeding.

Exactly. Even if EU allowed it, there was less than 1% of shares that other shareholders agreed to sell to Ryanair.

Obviously this is a good decision for the consumers and it seems that everyone but MOL applauds it.


User currently offlineJmc757 From United Kingdom, joined Mar 2000, 1298 posts, RR: 7
Reply 4, posted (7 years 3 months 1 week 1 day 10 hours ago) and read 2260 times:

It is the right decision. The cynic in me thinks even O'Leary knows its never going to happen, it keeps him and Ryanair in the papers though.

User currently offlineToulouse From Switzerland, joined Apr 2005, 2758 posts, RR: 58
Reply 5, posted (7 years 3 months 1 week 1 day 10 hours ago) and read 2260 times:

Quoting SandroZRH (Reply 1):
Thank god for that!

You can say that again SandroZRH!

Quoting EI321 (Reply 2):
I dont think this ever had a serious chance of succeeding.

I agree with you on that, but I've been looking forward to getting the official word from the EC anyway.

Quoting Danny (Reply 3):
Obviously this is a good decision for the consumers and it seems that everyone but MOL applauds it.

Certainly, I for one cannot understand who any Irish person (except MOL and his crowd) could see any good in this take-over bid, as as you have said, this is good news for consumers into and out of Ireland.



Long live Aer Lingus!
User currently offlineOverlander From Ireland, joined Aug 2005, 150 posts, RR: 0
Reply 6, posted (7 years 3 months 1 week 1 day 10 hours ago) and read 2229 times:

Did Mr O'Leary really believe that this takeover would 'fly'.

Or was it just a nice little stunt - 'them against us' and Ryanair is in the news again.

All the best,

Overlander

P.S Mr O'Leary, please try to clean the toilets on your planes before building an empire, at least try to give your customers some respect.



It is better to travel hopefully.............but, always be prepared for the worst!
User currently offlineBA319-131 From United Kingdom, joined Jan 2001, 8552 posts, RR: 55
Reply 7, posted (7 years 3 months 1 week 1 day 10 hours ago) and read 2199 times:
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Quoting SandroZRH (Reply 1):
Thank god for that!

- Never were truer words spoken

Quoting Jmc757 (Reply 4):
The cynic in me thinks even O'Leary knows its never going to happen, it keeps him and Ryanair in the papers though.

- Good point and probably likely!



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User currently offlinePe@rson From United Kingdom, joined Jan 2001, 19233 posts, RR: 52
Reply 8, posted (7 years 3 months 1 week 1 day 10 hours ago) and read 2167 times:

I'm glad it won't be able to: it's far more important for Ryanair to continue to expand organically than to acquire Aer Lingus (or any other airline for that matter).

[Edited 2007-06-27 15:00:01]


"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
User currently offlineOverlander From Ireland, joined Aug 2005, 150 posts, RR: 0
Reply 9, posted (7 years 3 months 1 week 1 day 9 hours ago) and read 2132 times:

Quoting Pe@rson (Reply 8):
Funny how it's all the usual Bash Ryanair Brigade moaning and moaning.

Yes, it is funny how people keep 'moaning and moaning', it is funny and ironic.

As someone who has never had to 'Bash' Ryanair before, but just made a comment as a customer about the disgusting state of their toilets, am I part of the Brigade?

All the best,

Overlander



It is better to travel hopefully.............but, always be prepared for the worst!
User currently offlineBrianDromey From Ireland, joined Dec 2006, 3920 posts, RR: 9
Reply 10, posted (7 years 3 months 1 week 1 day 9 hours ago) and read 2118 times:

Quoting Pe@rson (Reply 8):
Ryanair. Ireland's national airline.

Ryanair is certainly not the Irish National Airline. But neither is Aer Lingus. Ireland, along with most countries in the EU no longer has a national airline. FR only uses the title of "Irelands National Airline" when it suits them, the rest of the time, its "Europe's No. 1", "Europes Loc-Co", etc.

Quoting Pe@rson (Reply 8):
Funny how it's all the usual Bash Ryanair Brigade moaning and moaning. But for FR and the like, you'd still have Rip-Off Lingus offering an inferior product at considerable cost.

In the first 7 replies no one was moaning. This deal was a bad idea for consumers, a bad Idea for DUB airport and a bad idea for competion.

MOLs statement is, as usual, full of inaccuracies, mistruths and propaganda.

Quoting ryanair.com:


News Release
--------------------------------------------------------------------------------

26.06.07
EU COMMISSION TO BLOCK AER LINGUS TAKEOVER

EUROPEAN CONSUMERS DENIED €100m P.A. IN LOWER FARES BY THE EU



Ryanair, Europe’s largest low fares airline today (Tuesday 26 June) held a Press Conference in Brussels to respond to the recent European Commission leaks indicating that Ryanair’s offer for Aer Lingus will be prohibited. Ryanair expects this prohibition decision to be announced by DG Competition over the coming week.

Ryanair condemned this prohibition decision on a number of grounds as follows:

1.This prohibition reverses 20 years of EU airline consolidation which has seen the Commission approve all other mergers between larger competitors including Air France/KLM, Lufthansa/Swiss and Lufthansa/Austrian, all with minimal remedies.

2.This prohibition is unjustified in the case of two airlines which between them account for less than 5% of the EU air travel market.

3.The decision is politically motivated, designed to appease the narrow interests of the Irish Government, which was the only party (other than Aer Lingus itself) to object to the merger.

4.This decision is bad for consumers, because it allows Aer Lingus to continue to increase its fares and levy unjustified fuel surcharges, both of which would have been reduced/eliminated had the Ryanair merger succeeded.

5.The decision is manifestly erroneous as it applys a citypair analysis (e.g. claiming that Aer Lingus flights to Heathrow and Charles de Gaulle compete with Ryanair flights to Stansted and Beauvais) when every other EU airline merger precedents have applied an airport pair analysis (under which rules typically Heathrow and Charles de Gaulle would be deemed to be separate markets from Stansted and Beauvais respectively).

6.The decision is manifestly in error since it is based on the Commission’s inaccurate claim that there are barriers to entry at Dublin Airport, when the case file evidence clearly proves that there are no barriers to entry at Dublin Airport.

7.The decision inaccurately claims that other competitors would not enter Dublin Airport, when the case file proves that other competitors have confirmed they will enter Dublin Airport.

8.The decision is based on applying a “base” competition concept which has no precedent and is a misapplication of 25 year old US cases.

9.The Commission wrongly claims that Aer Lingus has a record of entering routes where Ryanair operates. In fact the opposite is the case. Aer Lingus has withdrawn from over 20 Ryanair routes in the past 7 years.



The decision ignores the substantial consumer benefits of over €100m p.a. guaranteed by Ryanair’s remedies package which included:


A. Reducing Aer Lingus’s short-haul fares by 10% p.a. (saving consumers over €70m p.a.).
B. Immediately eliminating Aer Lingus’s fuel surcharges (saving consumers over €30m p.a.).
C. Transferring Heathrow slots to BA and Air France, who will each base aircraft in Dublin.
D. Transferring Dublin slots to other competitors, as long as they based between 6 to 10 new aircraft in Dublin (a total of over 2,800 weekly slots).

1. Austrian and Lufthansa have merged? News to me.
2. 5% of EU equated to 80% of DUB traffic, no other airline merger examined by the EU commands such a % of traffic.
3. The Unions, the Irish public and the Irish Competion Comission.
4. EI does not charge surcharges on Short-Haul.
5. Funny, FR ahve been saying exactly the opposite of this for the last 10 years, and it is only because they are forced to that they differentiate between the lieks of FRA/HHN, LHR/STN.
6/7. Have FR forgotten Go fly, Norwegian, easyJet, and Aer Arann???
8. Jargon, utterly meaningless to me, perhaps someone could explain?
9. Fair enough.

A. Just like FR did when baggage charges were introduced?
B. Fuel Charges on short haul? I dont think so. FR does not compete with EI on long haul. So that is meaningless.
C. So FR now knows what BA and AF are going to do, fathermore it can tell these companies what to do with thier slots?
D. Fair enough. Except DUb does not currently have slots, and FR is trying to keep it that way, with legal proceedings currently underway.

I for one am very gald FR will not be allowed to take over EI. I like the choice,and judging by the high load factors EI enjoys, so do many others.

Brian.



Next flights: MAN-ORK-LHR(EI)-MAN(BD); MAN-LHR(BD)-ORK (EI); DUB-ZRH-LAX (LX) LAX-YYZ (AC) YYZ-YHZ-LHR(AC)-DUB(BD)
User currently offlineDanny From Poland, joined Apr 2002, 3509 posts, RR: 2
Reply 11, posted (7 years 3 months 1 week 1 day 9 hours ago) and read 2063 times:

Quoting Ryanair:
This prohibition is unjustified in the case of two airlines which between them account for less than 5% of the EU air travel market.

But in excess of 90% in Ireland.

Quoting Ryanair:
The decision is politically motivated, designed to appease the narrow interests of the Irish Government, which was the only party (other than Aer Lingus itself) to object to the merger.

From what I heard just about everyone except for Ryanair was opposing it.

Quoting Ryanair:
This decision is bad for consumers, because it allows Aer Lingus to continue to increase its fares and levy unjustified fuel surcharges, both of which would have been reduced/eliminated had the Ryanair merger succeeded.

What a bunch of crap. Facing fierce competition from FR, Aer Lingus continues to rip off customers and only Ryanair monopoly would free them from that. Yeah.

Quoting Ryanair:
The decision is manifestly in error since it is based on the Commission's inaccurate claim that there are barriers to entry at Dublin Airport, when the case file evidence clearly proves that there are no barriers to entry at Dublin Airport.

There are no barriers of entry other than Ryanair will duplicate routes and dump them with huge amount of free seats to force competition out. Go, Easyjet, Alitalia, Air Malta, Norwegian, HLX, LOT... Who next?

Quoting Ryanair:
The decision ignores the substantial consumer benefits of over €100m p.a. guaranteed by Ryanair's remedies package which included:


A. Reducing Aer Lingus's short-haul fares by 10% p.a. (saving consumers over €70m p.a.).
B. Immediately eliminating Aer Lingus's fuel surcharges (saving consumers over €30m p.a.).
C. Transferring Heathrow slots to BA and Air France, who will each base aircraft in Dublin.
D. Transferring Dublin slots to other competitors, as long as they based between 6 to 10 new aircraft in Dublin (a total of over 2,800 weekly slots).

How ridiculous can you be? Who was charging £1000 for flight to Athens for Champions League final? Ryanair will charge as much as it possibly can as soon as the competition is gone.


User currently offlinePe@rson From United Kingdom, joined Jan 2001, 19233 posts, RR: 52
Reply 12, posted (7 years 3 months 1 week 1 day 9 hours ago) and read 2059 times:

Quoting Danny (Reply 11):
From what I heard just about everyone except for Ryanair was opposing it.

I certainly oppose it:

Quoting Pe@rson (Reply 8):
I'm glad it won't be able to: it's far more important for Ryanair to continue to expand organically than to acquire Aer Lingus (or any other airline for that matter).

Far more important things for it to concentrate on.

[Edited 2007-06-27 15:29:07]


"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
User currently offlineOverlander From Ireland, joined Aug 2005, 150 posts, RR: 0
Reply 13, posted (7 years 3 months 1 week 1 day 9 hours ago) and read 2026 times:

Quoting Pe@rson (Reply 8):
I'm glad it won't be able to: it's far more important for Ryanair to continue to expand organically than to acquire Aer Lingus (or any other airline for that matter).

Ah, now I see your edited point.

It has become clear to me where you are coming from 'organically' speaking.

All the best,

Overlander



It is better to travel hopefully.............but, always be prepared for the worst!
User currently offlineBA787 From United Kingdom, joined Jun 2006, 2596 posts, RR: 7
Reply 14, posted (7 years 3 months 1 week 1 day 5 hours ago) and read 1930 times:

Quoting Pe@rson (Reply 12):



Quoting Pe@rson (Reply 8):

I wish people wouldn't edit their posts to the extent that all the subsequent posts with quotations end up being confusing. You re-hashed a lot of that post, although given the quotation remarks I can't say I blame you.

Gets irritating


And thank god for that, would have been a disaster



BA787


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