Clydenairways
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Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 12:44 pm

The plan was announced back in June, but now it has been formally submitted.
Personally, i don't feel he has a chance of getting past competition law, but it will be interesting to see how this plays out anyway.

http://www.irishtimes.com/newspaper/breaking/2012/0717/breaking20.html
 
kaitak
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 12:53 pm

Third attempt, third "no"; what part of "get stuffed" does MO'L not understand.

He must know this; why put in the effort when it's going to be rejected; what is his gameplan. It just seems a bit mad to be saving pennies here and there in flying operations, only to squander it on the legal costs associated with work like this. (And this doesn't come cheap, let me tell you!)
 
Danny
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 12:54 pm

If BA can buy BMI I don't see why Ryanair could not buy Aer Lingus for competition reasons. This may be in fact EI last chance to sell before FR forces them out of business.
 
SeeTheWorld
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 1:03 pm

Quoting Danny (Reply 2):
If BA can buy BMI I don't see why Ryanair could not buy Aer Lingus for competition reasons. This may be in fact EI last chance to sell before FR forces them out of business.

I agree ... And, I think his continued attempt makes Brussels look one-sided and foolish ....
 
Eagleboy
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 1:12 pm

Quoting Danny (Reply 2):
This may be in fact EI last chance to sell before FR forces them out of business.

Currently EI are the only airline that have managed to successfully compete in the same market as FR. I don't see them going out of business anytime soon.

The financial figures used by FR are for the last 6 years, 2/3 of which were under a pretty incompetent exec/mgmt team (1 of whom was ex-FR) The last 2 years have seen a cost reduction and streamlining program implemented which has greatly reduced EI costs. FR know they need to get EI now before the medium/long term effects of this restructuring come into play.

And if the bid was allowed then over 75% of all air travel out of an island nation would be under the control of a openly aggressive and avaricious business model. The capacity of DUB isn't a barrier to other airlines operating in/out, the present of FR and EI is the barrier. EZ tried routes out of Ireland before and were undercut and chased out by FR.
 
Danny
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 1:30 pm

Quoting EagleBoy (Reply 4):
The last 2 years have seen a cost reduction and streamlining program implemented which has greatly reduced EI costs

Operating costs for 2011 were pretty much the same as for 2009 (1239k vs 1286k EUR). The profit came from increased revenue and will go away as soon as they start to feel the 2nd wave of crisis.
 
EIDL
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 1:38 pm

Quoting Danny (Reply 5):
Operating costs for 2011 were pretty much the same as for 2009 (1239k vs 1286k EUR). The profit came from increased revenue and will go away as soon as they start to feel the 2nd wave of crisis.

They are operating significantly more flights on a (marginally) larger fleet with far higher fuel costs than 2009. If revenue falls away, they'll drop flights and costs will drop.

EI are the only "small" airline that have ever managed to compete with FR and this is a last bid of bravado from MO'L and nothing more. He's likely to be forced to sell the stake by the UK govt and wants to push the share price as high as possible, that's all.
 
UAL777UK
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 1:45 pm

Quoting kaitak (Reply 1):
If BA can buy BMI I don't see why Ryanair could not buy Aer Lingus for competition reasons.

One slight difference, BMI was on the verge of ceasing ops as it was pouring cash down the drain, I dont think thats happening with EI so you cannot complare the two. BA saved BMI or at least a lot of peoples jobs there, FR are not stepping in to be the shining knight here.

Will be interesting to see how it plays out though.
 
PoianaMarco
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 2:12 pm

I just can´t see, why EI are not willing to sell the whole company to FR. They arent waht ypu would call a super airline?..
The secret behind a good working day is happy guests and to know that you have been giving 110% and not just 100 of seri
 
GCT64
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 2:38 pm

I understand it, the EI shares are held as follows:

FR: 30% (clearly voting for the takeover)
Irish Government: 25% (they need to sell them as part of cash raising, state debt situation improvement)
Others: 45% (it's all about price)

The "Others" (the owners of 45% of the shares) have a price (more accurately "prices" as each shareholder will probably have a slightly different price) at which they are prepared to sell, it is simply whether FR are prepared to pay enough to get them to sell.

The government has a dilemma, they need to sell the shares for as much as they can get, they probably don't want to sell to FR (MO'L isn't the most likeable, polite or establishment type of guy and you can geneuinely argue a competition issue), but who else is going to buy those shares if not FR?

MO'L is neatly putting the government in position with very few options (other than his own).
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SKAirbus
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 3:35 pm

There are a lot more players in the UK market than the Irish market, which is why FR's attempted take over of EI will be more controversial in the eyes of the EU than BA's take over of BMI.

Essentially FR and EI are the only significant domestic carriers in Ireland so any merger will result in them pretty much owning the market apart from foreign carriers operating into the country from their home bases.

In the UK you have BA, VS, U2, LS, BE as major players so the BMI takeover was seen as less controversial, even in respect of LHR slots.
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OA260
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 3:51 pm

A recent poll by a newspaper showed that 54% were not in favor of an FR takeover, 24% were in favor and 21% didnt know or care either way .

And a local businessman is buying more of Aer Lingus to try stop a take over. :

Share buying was to foil Ryanair bid, says O'Brien

Businessman Denis O'Brien said he invested in Aer Lingus to thwart Ryanair's ambition to take over the carrier as he didn't want investors in Ireland to be flown by the discount airline.

"I didn't think it was a great idea for Ryanair to be flying foreign direct investors into Ireland," Mr O'Brien said in an interview with Bloomberg Television.

http://www.independent.ie/business/i...anair-bid-says-obrien-3146346.html
 
MaverickM11
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 3:59 pm

Quoting Danny (Reply 2):
I don't see why Ryanair could not buy Aer Lingus for competition reasons.

   What exactly are you saving EI from/for? It's perpetually on the brink of disaster and its service isn't that much different from FR.

Quoting SeeTheWorld (Reply 3):
I think his continued attempt makes Brussels look one-sided and foolish ....

  
E pur si muove -Galileo
 
SeeTheWorld
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 4:34 pm

Quoting SKAirbus (Reply 10):
There are a lot more players in the UK market than the Irish market, which is why FR's attempted take over of EI will be more controversial in the eyes of the EU than BA's take over of BMI.

Essentially FR and EI are the only significant domestic carriers in Ireland so any merger will result in them pretty much owning the market apart from foreign carriers operating into the country from their home bases.

In the UK you have BA, VS, U2, LS, BE as major players so the BMI takeover was seen as less controversial, even in respect of LHR slots.

I don't agree with your reasoning ... LHR is so congested and slot-controlled that the other competitors are less relevant. Second, FR is a low-fare carrier, so the competitive concern is much less than at a place like LHR with huge amounts of business traffic. And, last time I checked the EU has open skies, so anyone can go into any Irish airport and provide service and compete against FR ....
 
kl911
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 4:50 pm

Quoting clydenairways (Thread starter):
Personally, i don't feel he has a chance of getting past competition law, but it will be interesting to see how this plays out anyway.

Why not? Most countries in Europe have only one airline. Why would Ireland need two?

Quoting SeeTheWorld (Reply 3):
I think his continued attempt makes Brussels look one-sided and foolish ....

Yes, that is what they already are concerning this topic.
 
EIDL
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 5:07 pm

Quoting kl911 (Reply 14):
Why not? Most countries in Europe have only one airline. Why would Ireland need two?

Most countries in Europe are served by the airline of the country they're flying to on a given route as well as their own.

In Ireland's case, that isn't common. No Alitalia, no KL, no TP, etc; even AF use their WX metal most of the time.

Irish aviation is very much a two player game, EI and FR - EI now being bigger from DUB.

Despite FRs claims, letting them acquire EI would bring us back to the 1980s choice and competition wise.
 
tonystan
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 5:11 pm

Quoting kl911 (Reply 14):
Why not? Most countries in Europe have only one airline. Why would Ireland need two?

Thats rubbish! Most EU countries have more then one airline....OR at least a fair amount of competition!

Take EI away and all Ireland will have will be a mass FR hub and then a handful of other diddly little services which will be constantly and aggressively attacked by FR until they pull out and we can expect higher fairs as a result!

EI is profitable, it is doing well holding its own and FR should just give it up!
My views are my own and do not reflect any other person or organisation.
 
kl911
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 5:22 pm

Quoting EIDL (Reply 15):
In Ireland's case, that isn't common. No Alitalia, no KL, no TP, etc; even AF use their WX metal most of the time.

Those countries will launch flights when EI is gone anyway. Same happened with Budapest and Malev. There we have a large FR and W6 presence, but almost all capitals are covered by full frills airlines.
 
kl911
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 5:23 pm

Quoting tonystan (Reply 16):
Take EI away and all Ireland will have will be a mass FR hub and then a handful of other diddly little services which will be constantly and aggressively attacked by FR until they pull out and we can expect higher fairs as a result!

Lol, and guess what EI was doing when FR entered the Irish market....
 
EIDL
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 5:30 pm

Quoting kl911 (Reply 18):
Lol, and guess what EI was doing when FR entered the Irish market....

Charging much the same as FR but from a proper airport?

FR were not a budget airline until maybe ten years in to their life. They ran wrecks from secondary airports and charged basically the same. Had business class and a FFP.

Quoting kl911 (Reply 17):
Those countries will launch flights when EI is gone anyway. Same happened with Budapest and Malev. There we have a large FR and W6 presence, but almost all capitals are covered by full frills airlines.

Quite how the media outside of Ireland (and most of the media within Ireland at that) haven't realised that this bid is never going to go ahead astounds me. EI aren't going to be sold to FR - the deal will be blocked and the ISE have a three-strikes rule meaning that FR cannot bid again for some substantial period.
 
kl911
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 5:34 pm

Quoting OA260 (Reply 11):
Businessman Denis O'Brien said he invested in Aer Lingus to thwart Ryanair's ambition to take over the carrier as he didn't want investors in Ireland to be flown by the discount airline.

"I didn't think it was a great idea for Ryanair to be flying foreign direct investors into Ireland," Mr O'Brien said in an interview with Bloomberg Television.

What a lame excuse... The likes of KL, TP, AF, LH, BA etc will launch or upgrade routes immediately might EI fold or been taken over by FR.
 
Eagleboy
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 5:34 pm

Quoting SeeTheWorld (Reply 13):
And, last time I checked the EU has open skies, so anyone can go into any Irish airport and provide service and compete against FR ....

But so far they haven't....I wonde why. The dominance of the 2 competing Irish airlines maybe makes entry too problematic.

Quoting kl911 (Reply 14):
Most countries in Europe have only one airline.

Most countries in Europe aren't as reliant on air travel as an island on the edge of Europe!

Quoting kl911 (Reply 18):
guess what EI was doing when FR entered the Irish market....

Actually it was EI and BA, but your point is valid. FR broke the old monoply and are now trying to re-create it again in THEIR favour.
 
mikey72
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 5:36 pm

Didn't Willie Walsh say that he could see that FR had a point in as much as the industry had moved on alot since the last attempt and that the economic environment had also changed significantly.
Flying is like sex - I've never had all I wanted but occasionally I've had all I can stand.
 
Eljonno
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 5:50 pm

Out of interest, what would FR do with EI if they did take control? Would EI cease to exist and just be swallowed up under the Ryanair brand?
 
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ClassicLover
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 5:56 pm

Quoting eljonno (Reply 23):
Out of interest, what would FR do with EI if they did take control? Would EI cease to exist and just be swallowed up under the Ryanair brand?

Ryanair are stating that they will remain two separate brands. Ryanair will continue to serve secondary airports at low fares and no frills, while Aer Lingus will continue serving major capital city airports and their transatlantic routes. Ryanair plan to grow Aer Lingus traffic from 9 million to 14 million over the next 5 years, through expansion, cutting loss making Aer Lingus routes and opening new Aer Lingus routes. Also mentioned were increases in staff productivity.

Also, they are saying that this gives Aer Lingus a chance to remain Irish owned and managed as opposed to being bought by another European airline group.

All of it makes total sense to me really.

There is no way Aer Lingus would be closed down - otherwise you'd have every European carrier serving their capital to Dublin instead. Ryanair will never serve places like LHR, AMS, ARN, CDG, etc, etc... so Aer Lingus has a use. Nor will Ryanair go transatlantic anytime soon, I wouldn't think - and Aer Lingus already has the brand recognition for this.

The question I would ask people is - would you agree that Ryanair is the best choice for Aer Lingus if Michael O'Leary WAS NOT in charge of Ryanair? I think a lot of it, as an Australian living Ireland, is due to a negative perception of MO'L rather than Ryanair. But I could be wrong. It's how I see it anyway.
I do quite enjoy a spot of flying - more so when it's not in Economy!
 
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shamrock350
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RE: Ryanair Submits Formal Bid For Aer Lingus

Tue Jul 17, 2012 6:40 pm

There is one question constantly avoided when this crops up. What does Ryanair gain from buy Aer Lingus? The answer is not a lot other than removing it's home competitor. Is that really a good reason to sell Aer Lingus to Ryanair?

The way some go on around here you'd think Aer Lingus was going bankrupt every year since 2001. Over a decade later and they're still waiting for it to happen!

Quoting kl911 (Reply 18):
Lol, and guess what EI was doing when FR entered the Irish market....

What's your point? By that reasoning you believe because EI once held a monopoly in the Irish market that it's acceptable FR get their own back and recreate that monopoly in their favour. Seems a bit of a silly argument to me.

Quoting PoianaMarco (Reply 8):
I just can´t see, why EI are not willing to sell the whole company to FR. They arent waht ypu would call a super airline?..

Why on Earth would any airline just hand themselves over to their biggest competitor? So what if Aer Lingus isn't a "super airline" as you put it, there's a place for it in Irish market and it proves that by being the largest airline in Ireland's two biggest airports, serves more Irish airports than Ryanair and is also the largest airline in terms of flights between the UK and Ireland.

Quoting MaverickM11 (Reply 12):
What exactly are you saving EI from/for? It's perpetually on the brink of disaster and its service isn't that much different from FR.

Wrong on both counts. Aer Lingus is profitable, not on the brink of disaster. Service doesn't start and finish with the buy on board menu, Aer Lingus offers a very different product to Ryanair which includes codeshares, interline agreements, frequent flyer programme, lounges, flexible fares, transatlantic routes and central airports. All that before you even step on board where Aer Lingus cabin crew are experienced, there's assigned seating and the cabins are comfortable with no scratch card sales.

Quoting GCT64 (Reply 9):
The government has a dilemma, they need to sell the shares for as much as they can get, they probably don't want to sell to FR (MO'L isn't the most likeable, polite or establishment type of guy and you can geneuinely argue a competition issue), but who else is going to buy those shares if not FR?

Etihad is one airline which has openly expressed interest in the governments stake, they've already acquired 3% of Aer Lingus. Etihad also said last week that they would not sell and support the management of Aer Lingus and their strategy for the airline.

http://www.ft.com/cms/s/0/3b1d6e9a-c...d5-00144feabdc0.html#axzz20uEKTIlF

Quoting eljonno (Reply 23):
Out of interest, what would FR do with EI if they did take control? Would EI cease to exist and just be swallowed up under the Ryanair brand?

Remember what happened to Buzz? Aer Lingus might last a bit longer, I'd give the brand 5 years before it completely disappeared.

Quoting ClassicLover (Reply 24):
All of it makes total sense to me really.

The plan sounds great to me but that's because it's exactly what Ryanair want you to hear. Again, ask yourself what Ryanair gains from this great plan for Aer Lingus,

Quoting ClassicLover (Reply 24):
The question I would ask people is - would you agree that Ryanair is the best choice for Aer Lingus if Michael O'Leary WAS NOT in charge of Ryanair?

No. John from down the road could be in charge of Ryanair and it would still be an issue. It's the position that Ryanair would gain that is the problem, not who runs the airline.
 
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Revelation
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 1:22 am

Quoting clydenairways (Thread starter):
Ryanair Submits Formal Bid For Aer Lingus

Subtitle: Ryanair Throws Snowball Towards Hell, Awaits Outcome

Quoting kaitak (Reply 1):
what part of "get stuffed" does MO'L not understand

   Bet he hears that expression several times a day!   

If I ever meet him, I hope I get the chance to tell him to get stuffed too!
Inspiration, move me brightly!
 
MaverickM11
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 2:46 am

Quoting shamrock350 (Reply 25):
Wrong on both counts. Aer Lingus is profitable, not on the brink of disaster.

2011 yes, but in the last ten years it has lost around 1-200MM pounds. And every couple years, almost like clockwork, something happens and EI is on the brink of collapse.
E pur si muove -Galileo
 
Eljonno
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 8:13 am

Quoting ClassicLover (Reply 24):
There is no way Aer Lingus would be closed down - otherwise you'd have every European carrier serving their capital to Dublin instead. Ryanair will never serve places like LHR, AMS, ARN, CDG, etc, etc... so Aer Lingus has a use. Nor will Ryanair go transatlantic anytime soon, I wouldn't think - and Aer Lingus already has the brand recognition for this.

Sounds fair enough to me. I guess gaining ownership of the Are Lingus brand is an asset that FR could certainly use to its advantage, where their own branding remains a separate entity. It would perhaps allow access to a different passenger demographic than the one that FR traditionally attracts, by serving more long haul and mid haul hub destinations.

Quoting shamrock350 (Reply 25):

That was my initial thought as well! Now I'm not sure it will happen (in the immediate future anyway).

Thanks for your answers.
 
tonymctigue
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 8:42 am

Quoting EagleBoy (Reply 4):
Currently EI are the only airline that have managed to successfully compete in the same market as FR. I don't see them going out of business anytime soon.

This is something that often gets overlooked and something that Aer Lingus don't get enough of credit for even on the Irish forum (probably because we're just so used to it at this point). There are no other legacy carriers that have had to put up with the onslaught of Ryanai in the same way as Aer Lingus have. There are no other legacy carriers that have had to deal with a massive Ryanair presence at their hub airport. For most of them, it is a fringe problem where Ryanair are flying to some secondary airport miles away from the city it is supposed to be serving and they may steal some of the lower yielding tourist traffic from them but they don't have to put up with the in-your-face Ryanair presence Aer Lingus have had to put up with.

As for this latest takeover bid, I personally like the idea of Aer Lingus remaining under Irish ownership and where would you find a more qualified Irish owner than Ryanair. That said, we had a situation where one carrier was overly dominant in the Irish market and we all know how well that worked. My personal preference is that if Aer Lingus are taken over then it is by someone like the Etihad who would likely use it to supplement their European presence by feeding traffic through DUB onto EI's European network. Rather than someone like IAG who would almost certainly asset strip the valuble slots at key hub airports then realign the EI route network to feed their own services, leaving the Irish market with a Ryanair monoploy i.e. leaving us in the same position as we would have been had FR taken over EI.
Airports: SNN GWY NOC DUB ORK BOS EWR JFK ORD MCI BOI SEA LHR STN CDG LYS FAO GVA HKG MEL ADL HBA
 
Sheridan125
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 10:48 am

My view of this is that RYR is likely to succeed this time. Let me set out my reasons for this view:
1. EI are in Ireland a much loved carrier but their business scope is almost totally inhibited by the fact that the largest international passenger airline in the world is right on their doorstep. The Irish are inveterate travellers but EI will never be able to exploit that simply because RYR exist. They therefore have no Irish growth prospects beyond the market norms in that country
2. It is perfectly possible for EI to remain a distinct brand within the RYR group. Mostly it serves different, usually the so-called main airports and because of that it does well in business traffic to those cities.
3. EI’s long haul business desperately needs to be broken out from the greater EI. It needs its own economics of specialisation. Reverting to its original Irish International name and with a relaunch around an expanded route network would make it a far stronger business
4. EI desperately needs to be extracted from any connection with Irish politics.
5. The Irish government have to sell their shares and there is never likely to be any other buyer than RYR. Who else would want to buy a small regional airline with a veritable giant living in their back yard. It has been open for anyone to offer to buy EI for years now but no one else has shown the slightest interest. RYR have offered to sell their shares to anyone who is seriously interested but the share register shows that they have sold none. There is no other buyer in the market. Etihad surely has bought 3%. Why anyone should buy 3% of EI is beyond me unless they are speculating that they will make a quick profit from a takeover. Remember that Etihad can never control EI because they are not an EU carrier.
6. EI is nothing more than a moderate regional carrier. It is based in one of the smallest EU states. It has tried to break out from this ( with its disastrous Gatwick experiment).
7. EI does not have the cost structure to compete with the really big beasts in Europe, nor does it have the buying power to get low prices from any supplier. RYR does. That buying power alone will provide huge benefits to EI.
8. The European airline industry is consolidating rapidly, partly through failures, partly through growth by RYR/EZY and partly because of the chilly economic atmosphere around these days. MOL is right when he suggests that there will be five powerful groups in future. IAG/LH/AF/RYR/EZY. By far the biggest of these in pax numbers, profits and market capitalisation is RYR. EI has to go into one of these groups and none of the others have shown any interest.
9. If the EU was satisfied about BA/BMI if will surely be able to secure concessions about RYR/EI.
10. The board of EI may think EI is undervalued in the bid but the market thinks otherwise. If the bid fails the share price will collapse. It will tumble much further if RYR is forced to sell its share.
11. ESOT no longer exists which means employees will be free to raise some cash from what has proved to be a disastrous investment by them in their employer. They will never get a better offer.
 
Ps76
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 10:54 am

Hi!

Quoting ClassicLover (Reply 24):
Ryanair are stating that they will remain two separate brands. Ryanair will continue to serve secondary airports at low fares and no frills, while Aer Lingus will continue serving major capital city airports and their transatlantic routes. Ryanair plan to grow Aer Lingus traffic from 9 million to 14 million over the next 5 years, through expansion, cutting loss making Aer Lingus routes and opening new Aer Lingus routes. Also mentioned were increases in staff productivity.

I'm only a sim pilot and armchair ceo but it seems that the setup would make Ryanair a quite messy company with quite possibly a lack of focus. They do well flying people to secondary airports in 737-800's. However personally speaking with their fares massively increasing over the past couple of years they hardly seem a better/cheaper option than Easyjet anymore. Personally I think their golden years are over.

Quoting ClassicLover (Reply 24):
Ryanair plan to grow Aer Lingus traffic from 9 million to 14 million over the next 5 years, through expansion, cutting loss making Aer Lingus routes and opening new Aer Lingus routes. Also mentioned were increases in staff productivity.

I seriously doubt they could grow traffic that much unless they have some secret they're not telling us. Would the global and Irish economies really reward expanding? Doesn't Aer Lingus already cut loss-making routes and look for profitable ones or does Michael O Leary just think he can do it better. As for increases in staff productivity that sounds like a very wishywashy term which doesn't really mean anything and surely wouldn't account for big profit increases.

I don't know if Ryanair will one day own Aer Lingus or not but if they keep the brands seperate I doubt much will change or bigger profits be made.

Many thanks.

Pierre
 
tonymctigue
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 11:58 am

Quoting Sheridan125 (Reply 30):
My view of this is that RYR is likely to succeed this time. Let me set out my reasons for this view:

Very hard to argue with anything you say there and EI is likely to eventually end up as part of some other airline group. Certainly your point about the buying power of FR would be of huge benefit to EI but with one airline being all Boeing and the other all Airbus, does that mean we are likely to see Boeing metal back in EI colours again?
Airports: SNN GWY NOC DUB ORK BOS EWR JFK ORD MCI BOI SEA LHR STN CDG LYS FAO GVA HKG MEL ADL HBA
 
sabenapilot
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 12:37 pm

Have FR asked the EU for approval?
It might have been a good dea to do so first....
My feeling is this is dead upon arrival right there, and thus this bid is a pointless attempt, but them it isn't truly about a take over bid at all, but rather just about all the commotion FR will be able to stir once formally beingblocked by the EU.
As we see here once more, attention whores really do everything to look interesting.
 
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Revelation
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 1:04 pm

Quoting ClassicLover (Reply 24):
Ryanair are stating that they will remain two separate brands. Ryanair will continue to serve secondary airports at low fares and no frills, while Aer Lingus will continue serving major capital city airports and their transatlantic routes.

That idea will last about as long as WN's idea of using FL's 717s in smaller markets, yada yada.

This is mostly about getting rid of a competitor.

Quoting shamrock350 (Reply 25):
What does Ryanair gain from buy Aer Lingus? The answer is not a lot other than removing it's home competitor. Is that really a good reason to sell Aer Lingus to Ryanair?

Along with that, I think it's clear MOL wants in to long haul. There really is no where else for FR to grow. IMHO it's a certainty that the real game plan is to provide chav class service across the Atlantic.
Inspiration, move me brightly!
 
Flyingsottsman
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 1:21 pm

If this was to happen, which name and livery would be flying? The Ryanair and livery or the Aer Lingus name and livery?
 
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anfromme
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 2:54 pm

Quoting Danny (Reply 2):
If BA can buy BMI I don't see why Ryanair could not buy Aer Lingus for competition reasons.

The situation is quite different, because even combined, BA and BMI don't have a duopoloy in Heathrow, let alone all of the UK, of the sort a merged Ryanair/Aer Lingus would have. In 2007, the combined entity would have controlled 80% (!) of all European flights to/from Dublin airport, and a similar share of all flights between Ireland and the UK. I doubt much has changed about that in the meantime, on the contrary, given the economic climate which has lead to some airlines stopping their intra-European services to Ireland.
Not even to go into the financial situation of BMI at the time of takeover vs. EI's current position.

Quoting Danny (Reply 2):
This may be in fact EI last chance to sell before FR forces them out of business.

FR have been trying to do that for ages at this point, with not as much success as MO'L would have hoped for - Christoph Mueller managed to turn EI into a profit-making airline in a much better position and with a much stronger balance sheet (and over €1 billion in cash) than in 2006 - yet, FR is now offering much less than they were in 2006.

Quoting EagleBoy (Reply 4):
Currently EI are the only airline that have managed to successfully compete in the same market as FR. I don't see them going out of business anytime soon.

  

Quoting MaverickM11 (Reply 12):
What exactly are you saving EI from/for? It's perpetually on the brink of disaster and its service isn't that much different from FR.

I'd suggest to check your facts before making such bold statements.
See shamrock350's post for details.

Quoting tonystan (Reply 16):
Take EI away and all Ireland will have will be a mass FR hub and then a handful of other diddly little services which will be constantly and aggressively attacked by FR until they pull out and we can expect higher fairs as a result!

EI is profitable, it is doing well holding its own and FR should just give it up!

  

Quoting kl911 (Reply 20):
What a lame excuse... The likes of KL, TP, AF, LH, BA etc will launch or upgrade routes immediately might EI fold or been taken over by FR.

So you're saying anybody that wants a bit more frill is going to switch to a foreign airline once EI is taken over by FR. Which is certain to have some effect on jobs in the combined EI/FR.
Given the country's current economic situation - do you really need more reasons for an Irish businessman to invest in EI because he's opposed to a takeover by FR?

Quoting ClassicLover (Reply 24):
The question I would ask people is - would you agree that Ryanair is the best choice for Aer Lingus if Michael O'Leary WAS NOT in charge of Ryanair? I think a lot of it, as an Australian living Ireland, is due to a negative perception of MO'L rather than Ryanair. But I could be wrong. It's how I see it anyway.

As a German living in Ireland and relying frequently on air travel to visit family, yes I would still be opposed to an EI takeover by FR even if it was not Micheal O'Leary at the helm. I'd also be opposed to Air Berlin being taken over by Lufthansa, for instance. As shamrock350 already stated - it's about the position a merged FR/EI would hold, effectively eliminating competition completely on an island market.
But yes, O'Leary being an annoying bully certainly doesn't help - if you think back to the Hangar 6 saga, for instance, where he tried every media trick in the book to take hold of a property he missed the boat on and that Aer Lingus were legally using at that point. Which makes it a lot harder to believe him when he says now that even after a takeover, EI would remain a separate airline with a different level of service. I'm quite sure he's capable of coming up with an excuse for wrapping all into one a few years down the line.

Quoting Revelation (Reply 26):
Subtitle: Ryanair Throws Snowball Towards Hell, Awaits Outcome

 
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Eagleboy
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 2:55 pm

Quoting Sheridan125 (Reply 30):
EI’s long haul business desperately needs to be broken out from the greater EI. It needs its own economics of specialisation. Reverting to its original Irish International name and with a relaunch around an expanded route network would make it a far stronger business

Well EI tried to separate the 2 sides of its business under the previous CEO, this was disastrous. The current strategy of using the shorthaul network to feed into the longhaul is what has fuelled the turnaround in EI financial footing over the last 2 years.

Quoting Sheridan125 (Reply 30):
EI desperately needs to be extracted from any connection with Irish politics.

While the Irish Govt own 25% of EI they have no operational control over the airline, so there are no political ties to EI.

Quoting Sheridan125 (Reply 30):
Who else would want to buy a small regional airline with a veritable giant living in their back yard. It has been open for anyone to offer to buy EI for years now but no one else has shown the slightest interest.

Because why buy into an airline that is already part owned by FR. The EI fleet assets and cash reserves are at least double the current market valuation of EI.

Quoting Sheridan125 (Reply 30):
.If the EU was satisfied about BA/BMI if will surely be able to secure concessions about RYR/EI

2 very different situations. Bmi was a basket case when it was taken over, EI is currently profitable. BA/bmi still only have 50-55% of capacity at their main airport, FR/EI control over 80% of the traffic at DUB, and similar amounts in all the other Irish airports.

Quoting Sheridan125 (Reply 30):
ESOT no longer exists which means employees will be free to raise some cash from what has proved to be a disastrous investment by them in their employer. They will never get a better offer.

I missed the part where EI 'invested' in themselves? If anyone made a bad investment it was FR in 2006/2007. E400M down the tube, their shareholders were very unhappy with MoL at the time.

Quoting Revelation (Reply 34):
Quoting ClassicLover (Reply 24):
Ryanair are stating that they will remain two separate brands. Ryanair will continue to serve secondary airports at low fares and no frills, while Aer Lingus will continue serving major capital city airports and their transatlantic routes.

That idea will last about as long as WN's idea of using FL's 717s in smaller markets, yada yada.

This is mostly about getting rid of a competitor.

I agree. I can see FR telling all non flight/cbin crew and engineers that they will transfer over to a new company under new conditions. Staff being kept on will have to take new restructuring and productivity cuts to ensure profitability. If the staff try to revolt or refuse FR will clima that they "tried their best to retain the EI brand but that they unfortunately have to close the EI shorthaul network to to union intransigence."

Quoting Flyingsottsman (Reply 35):
If this was to happen, which name and livery would be flying?

FR claim they will reatin both brands......they also said they would protect the Buzz employees when they bought them several years ago.
 
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 3:12 pm

Quoting EagleBoy (Reply 37):
I agree. I can see FR telling all non flight/cbin crew and engineers that they will transfer over to a new company under new conditions. Staff being kept on will have to take new restructuring and productivity cuts to ensure profitability.

Ofcourse they have to get new conditions. Thats why EI is loss making and FR isnt. FR has much lower wages.
It's also one of the reasons we can fly so cheap. Compare BUD - DUB with EI and FR and you will see whaat I mean. and aat least FR is always on time or early, something I really appreciate on a late evening flight.

Quoting EagleBoy (Reply 37):
2 very different situations. Bmi was a basket case when it was taken over, EI is currently profitable. BA/bmi still only have 50-55% of capacity at their main airport, FR/EI control over 80% of the traffic at DUB, and similar amounts in all the other Irish airports.

You are now comparing a world airport with a regional airport. Sorry to say, and I love Dublin,but thats what DUB is.



To be honest I have a feeling that some EI employees are also present in the discussion here. That's ofcourse ok, but please try to discuss from a neutral point of view. Anti FR posts are getting soooo old...
 
tonystan
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 3:33 pm

Quoting kl911 (Reply 38):
Thats why EI is loss making and FR isnt.

KL911.....How often do you need it spelt out? EI is NOT loss making! Just because people are disagreeing with you and trying to get you to see that EI is not Malev (I assume your previous national airline) does not mean that they are wrong!

And what if EI employees are contributing to this thread? Surely they know better then an armchair enthusiest who has no more info other then what he finds on google and wiki!
My views are my own and do not reflect any other person or organisation.
 
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shamrock350
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 3:37 pm

Quoting kl911 (Reply 38):
Thats why EI is loss making and FR isnt. FR has much lower wages.

Again, Aer Lingus is not loss making.

Aer Lingus profits from cost-cutting work

http://www.bbc.co.uk/news/business-17188458

Aer Lingus boosts profits forecast

http://www.ft.com/cms/s/0/6be02244-9...38-00144feab49a.html#axzz20uEKTIlF

Aer Lingus is profitable and growing. So far this year Aer Lingus passenger numbers are up 5.4% and load factors are up 2.6% which isn't at all bad for an airline that relies on the Irish market, one of the hardest hit by the economic crisis.

Quoting kl911 (Reply 38):
Anti FR posts are getting soooo old...

Some could say the pro FR point are also getting old.

Quoting MaverickM11 (Reply 27):
2011 yes, but in the last ten years it has lost around 1-200MM pounds. And every couple years, almost like clockwork, something happens and EI is on the brink of collapse.

Aer Lingus was only ever really on the brink of collapse after 9/11 and then struggled in the economic downturn of 2008/09 but quickly turned things around with profits in 2010, 2011 and expected profits this year. Hardly every couple of years.

Shamrock350 (Not an Aer Lingus employee)
 
Eagleboy
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 3:46 pm

Quoting kl911 (Reply 38):
Ofcourse they have to get new conditions. Thats why EI is loss making and FR isnt. FR has much lower wages.

EI has been profitable for the last 2 years under the (still ongoing) restructuring plan which is bringing the EI cost base close to that of EasyJet. (Got this nugget from EI financial results last year) This plan will continue to improve the EI financial staus over the next 2-5 years (barring the usual bodyblows to the aviation industry)

Quoting kl911 (Reply 38):
You are now comparing a world airport with a regional airport. Sorry to say, and I love Dublin,but thats what DUB is.

I wasn't comparing DUB to LHR, as you point out both are vastly different airports. I was comparing the effect of a take-over on market share %. VS tried to claim that the BA/Bmi merger would result in a monopoly when it was clear it would not. An EI takeover by FR would definitely result in a monopoly........this is true regardless of the size or type of airport I was referring to.

My personal opinion that is opposed to this takeover is based on a fear of an overall FR stranglehold on air travel out of Ireland. I am not opposed on anti-FR grounds. Personally I think the Irish do very well by having both airlines competing out of Ireland. I fly both carriers depending on my cash/time/convenience requirements on an individual trip. I feel a takeover would reduce my options in my travelling.
 
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anfromme
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 3:54 pm

Quoting Sheridan125 (Reply 30):
1. EI are in Ireland a much loved carrier but their business scope is almost totally inhibited by the fact that the largest international passenger airline in the world is right on their doorstep.

Are you talking about Emirates?
Yes, I know, FR use a different metric (number of passengers, not passenger-kilometres) - as they usually do if that helps the outcome to be more in their favour.
Anyway, FR have been on EI's doorstep for a good while now, and contrary to Ryanair's (and others') predictions, EI are not quite dead just yet. In fact, they're doing much better than even five years ago.

Quoting Sheridan125 (Reply 30):
The Irish are inveterate travellers but EI will never be able to exploit that simply because RYR exist. They therefore have no Irish growth prospects beyond the market norms in that country

As far as I am aware, EI offer more flights out of Dublin and Cork, the country's two largest airports, than FR; plus they also operate long-haul flights. So I'm not quite sure what you're getting at.

Quoting Sheridan125 (Reply 30):
2. It is perfectly possible for EI to remain a distinct brand within the RYR group. Mostly it serves different, usually the so-called main airports and because of that it does well in business traffic to those cities.
EI appears perfectly capable of doing this as a standalone entity, so I don't see how this supports your view that FR will be successfull this time.
Not to be neglected is the fact that EI get a lot of traffic through interline and codeshare agreements, particularly with BA, KL and UA. Should FR be successfull with their bid, at least some of these are quite likely to go away, thus also removing a good portion of the traffic EI are currently getting.

Quoting Sheridan125 (Reply 30):
3. EI’s long haul business desperately needs to be broken out from the greater EI. It needs its own economics of specialisation. Reverting to its original Irish International name and with a relaunch around an expanded route network would make it a far stronger business

Sounds like a non sequitur. I fail to see why this would be a) necessary and b) only possible if EI and FR merged. Furthermore, as EagleBoy pointed out, the previous management tried breaking EI into a long and a short haul business. At least as much of a disaster as the "Gatwick experiment" you quote.

Quoting Sheridan125 (Reply 30):
4. EI desperately needs to be extracted from any connection with Irish politics.
FR already hold a greater stake in EI than the Irish government. The government is intent (almost obliged under EU/IMF bailot terms) to sell their stake anyway. But I still fail to see how FR would be the only way to go here given than at least Etihad (I presume there are others) has expressed an interest in increasing their stake.

Quoting Sheridan125 (Reply 30):
5. The Irish government have to sell their shares and there is never likely to be any other buyer than RYR. Who else would want to buy a small regional airline with a veritable giant living in their back yard. It has been open for anyone to offer to buy EI for years now but no one else has shown the slightest interest.

See above. Also, EI isn't a regional airline. Aer Lingus Regional (aka Aer Arann) is.
By the way - would you want to buy into an airline that a competitor (FR) already holds almost 30% of? If anything, FR's stake in EI is probably one of the biggest obstacles in finding other major investors.

Quoting Sheridan125 (Reply 30):
Etihad surely has bought 3%. Why anyone should buy 3% of EI is beyond me unless they are speculating that they will make a quick profit from a takeover. Remember that Etihad can never control EI because they are not an EU carrier.

Didn't keep them from acquiring over 29% in Air Berlin.

Quoting Sheridan125 (Reply 30):
6. EI is nothing more than a moderate regional carrier. It is based in one of the smallest EU states. It has tried to break out from this ( with its disastrous Gatwick experiment).
FR is based in the same states as EI, so I don't know what point you're trying to make. Also, the Gatwick experiment was initiated by the previous management. One of the many mistakes of that management that the current EI leaders were quick to reverse.

Quoting Sheridan125 (Reply 30):
7. EI does not have the cost structure to compete with the really big beasts in Europe

You imply that they actually want to play in the same league as LH, AF, etc. I don't think they do.

Quoting Sheridan125 (Reply 30):
nor does it have the buying power to get low prices from any supplier. RYR does. That buying power alone will provide huge benefits to EI.
FR has so much buying power that Airbus' Leahy refused to enter negotiations with them, while Boeing also didn't want to play ball the last time round.
Also - by the same argument (buying power), any airline with fewer than 200 airplanes should just fold. Which is of course nonsense.

Quoting Sheridan125 (Reply 30):
8. The European airline industry is consolidating rapidly, partly through failures, partly through growth by RYR/EZY and partly because of the chilly economic atmosphere around these days. MOL is right when he suggests that there will be five powerful groups in future.

Which is what he wants you to believe. Despite all the consolidation in the US, there are still smaller airlines, as well as even startups, that seem to survive quite happily outside the big UA, DL, US and AA.

Quoting Sheridan125 (Reply 30):
IAG/LH/AF/RYR/EZY. By far the biggest of these in pax numbers, profits and market capitalisation is RYR.

That's just nonsense. LH Group carried over 106 million passengers in 2011, compared to 76 million carried by FR.

Quoting Sheridan125 (Reply 30):
9. If the EU was satisfied about BA/BMI if will surely be able to secure concessions about RYR/EI.

I know that this is (as many of the things you write) what FR/MO'L say, but that doesn't necessarily make it true.
As pointed out previously by numerous posters, including myself, there are some reasons to doubt that the BMI/BA takeover being approved is a valid comparison for the proposed EI/FR takeover.

Quoting Sheridan125 (Reply 30):
10. The board of EI may think EI is undervalued in the bid but the market thinks otherwise. If the bid fails the share price will collapse. It will tumble much further if RYR is forced to sell its share.

a) I wouldn't believe/trust "the market" unconditionally. It's been wrong too many times before, significantly undervaluing some companies and overvaluing others.
b) "The market" isn't an exact science. There is as much reason to believe that EI's price will rise once FR sell their share, which by many investors is seen as a dead weight to carry around with them, preventing more meaningful investments by others.

Quoting Sheridan125 (Reply 30):
11. ESOT no longer exists which means employees will be free to raise some cash from what has proved to be a disastrous investment by them in their employer. They will never get a better offer.

Aer Lingus staff still appear pretty unanimous in their rejection of the takeover by FR. Seems there is more than just the existence of ESOT to sway people one way or another.

[Edited 2012-07-18 09:01:49]
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anfromme
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 4:08 pm

Quoting sabenapilot (Reply 33):
My feeling is this is dead upon arrival right there, and thus this bid is a pointless attempt, but them it isn't truly about a take over bid at all, but rather just about all the commotion FR will be able to stir once formally beingblocked by the EU.

  
Case in point: Hangar 6.
Not as much about trying to get hold of Hangar 6 as about creating some FR PR with some anti-EI and anti-government slur thrown in. I fully expect the same this time round.

Quoting EagleBoy (Reply 37):
I missed the part where EI 'invested' in themselves? If anyone made a bad investment it was FR in 2006/2007. E400M down the tube, their shareholders were very unhappy with MoL at the time.

  
Indeed - what are you going to do with about 29% of an airline that you want to take over, but that you effectively know you won't be able to take over?
How about this: Submit a takeover bid you know won't go through but will increase the share price and then sell off your stake, under much swearing and cussing.
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MaverickM11
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 4:14 pm

Quoting anfromme (Reply 36):
I'd suggest to check your facts before making such bold statements.
See shamrock350's post for details.

It's profitable in 2011--have you looked at previous years?

Quoting shamrock350 (Reply 40):
Again, Aer Lingus is not loss making.

What about the last 5 years? 10 years? 2 years?
E pur si muove -Galileo
 
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anfromme
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 4:38 pm

Quoting MaverickM11 (Reply 44):
It's profitable in 2011--have you looked at previous years?

Yes. Back to 2001, EI's financial performance can easily be checked here:
http://en.wikipedia.org/wiki/Aer_Lingus#Financial_performance
For those too lazy to check: In the eleven years from 2001 to 2011 (inclusive), EI made a loss in 4 of them (2001, 2006, 2008, 2009), while it was profitable in 7.

Quoting MaverickM11 (Reply 44):
What about the last 5 years? 10 years? 2 years?

Or any other year or period that suits the agenda somebody's pushing?
Fact is that EI made big losses in 2008 and '09 in particular, but was profitable in 2010 and 2011. It is also projected to make a profit in 2012. It's got pretty healthy cash reserves to boost.
That's quite impressive given what EI have to deal with, such as a small domestic market, a badly hit economy in that market and FR's competition. That's before we even start talking about raising fuel prices, etc.
That's even pretty impressive overall considering how many airlines were making losses or even turning into losses in 2011 (e.g. LH).

So the trend seems quite positive, and EI appear relatively healthy at this point. I seriously fail to see what the talk about their imminent demise and their need for FR's help/takeover is all about.

[Edited 2012-07-18 09:40:00]
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EIDL
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 4:38 pm

Quoting MaverickM11 (Reply 44):

It's profitable in 2011--have you looked at previous years?

What about the last 5 years? 10 years? 2 years?

Different era, different regime. Not relevant to the here and now. EI as it is currently run is profitable, is the largest airline in Ireland - FR having vanished off to other parts of Europe for the most part - and isn't going to be successfully bought by FR.
 
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shamrock350
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 4:47 pm

Quoting MaverickM11 (Reply 44):
What about the last 5 years? 10 years? 2 years?

2011 - Profit
2010 - Profit
2009 - Loss
2008 - Loss
2007 - Profit
2006 - Loss
2005 - Profit
2004 - Profit
2003 - Profit
2002 - Profit
2001 - Loss

2012 is expected to be profitable.

[Edited 2012-07-18 09:54:55]
 
MaverickM11
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 4:48 pm

Quoting anfromme (Reply 45):
Yes. Back to 2001, EI's financial performance can easily be checked here:
http://en.wikipedia.org/wiki/Aer_Lingus#Financial_performance
For those too lazy to check: In the eleven years from 2001 to 2011 (inclusive), EI made a loss in 4 of them (2001, 2006, 2008, 2009), while it was profitable in 7.

For a net 170M pounds loss before taxes, or 70M after taxes = not profitable.
E pur si muove -Galileo
 
Eagleboy
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RE: Ryanair Submits Formal Bid For Aer Lingus

Wed Jul 18, 2012 4:53 pm

Quoting MaverickM11 (Reply 48):
For a net 170M pounds loss before taxes, or 70M after taxes = not profitable.

Have you noticed the > 1 Billion Euro cash reserves they have on their balance sheet as per the 2012 1st quarter results?

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