RYANAIR CHIEF Michael O’Leary is attempting to recruit Minister for Transport Noel Dempsey to his campaign to cut Aer Lingus directors’ fees.
Flanked by two pantomime pigs, Mr O’Leary, whose company owns over 29 per cent of the rival airline, said yesterday that he had given Mr Dempsey the right to vote on behalf of Ryanair at the Aer Lingus agm next week.
Mr O’Leary has appointed the Minister as Ryanair’s proxy for the agm. This means Mr Dempsey can combine the airline’s 29 per cent stake with the State’s 25 per cent, giving him an automatic majority in any vote.
The Ryanair boss is targeting Aer Lingus non-executive directors’ fees, which he says have accelerated to €730,000 in 2008 from €141,000 in 2006. He declared yesterday that his company wants board members to “get their snouts out of the trough”.
He singled out Irish Congress of Trade Unions general secretary David Begg who last year received €41,000 and chairman Colm Barrington, who was paid €58,000.
One of the “pigs” at yesterday’s conference held up a sign with Begg on it, while the other had a sign labelled Barrington. They also had signs calling on the Minister to “vote to remove directors’ snouts from the Aer Lingus fees trough”.
The Ryanair chief said that its non-executive directors are paid a flat €30,000 a year. “And we have a market capitalisation of €5 billion, while Aer Lingus is just €300 million; on that basis, its directors should be getting €3,000 a year,” he said.
Mr O’Leary has been waging a campaign against directors’ fees for a number of months. He recently wrote to 4,000 other shareholders seeking their support.
“The Minister said that Aer Lingus should look at cutbacks,” he said. “We think they should start with the board.”
Aer Lingus board members have already agreed to take a 20 per cent pay cut, but Ryanair said yesterday that it did not believe this is enough. Mr O’Leary said Ryanair was giving its proxy to the Minister because the Aer Lingus board had rejected the airline’s previous attempts to raise this and other issues.
“They might listen to the Minister, even if they don’t listen to their biggest shareholder,” he said.
Aer Lingus recently predicted that it would lose €100 million this year. Analysts believe its cash reserves could be reduced to €400 million over the same period.
Responding to Mr O’Leary’s call last night, Mr Dempsey’s office told The Irish Times: “The Minister for Transport acknowledges receipt of a request this evening by Ryanair to act as its proxy at the upcoming Aer Lingus agm. He will consider this request and make his decision known in due course.”
