Sale of Aer Lingus slots likely to meet opposition

The Government and the Aer Lingus Employee Share Ownership Trust (Esot) are likely to block any attempt by Ryanair to sell Aer…

The Government and the Aer Lingus Employee Share Ownership Trust (Esot) are likely to block any attempt by Ryanair to sell Aer Lingus landing slots at Heathrow Airport.

It had been reported yesterday that Ryanair had offered to sell the landing slots at Heathrow in a bid to win European Commission approval for a takeover of Aer Lingus.

The European Commission has until July 4th to decide whether Ryanair's bid is anti-competitive. Some analysts said Ryanair would have to give up landing slots at Heathrow, Stansted and Dublin airports as the two airlines overlap on 17 routes.

When Air France and KLM merged, the combined airline was forced to give up slots on nine routes.

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According to reports from Reuters, Ryanair has offered to sell slots at Dublin and Heathrow to British Airways and CityJet.

But that is likely to meet opposition from the Government, which in the past has described the slots as a strategic asset.

"At the time Aer Lingus was floated on the stock exchange back in September, measures were put in place to safeguard against the disposal by Aer Lingus of slots at Heathrow," said a spokeswoman for the Department of Transport.

Protection of the Heathrow slots is written into the company's articles of association.

Speaking in the Dáil last November, Minister for Transport Martin Cullen said company's memorandum and articles of association could not be changed, and other changes requiring special resolutions could not be made, without Government support.

Any disposal of the Heathrow slots can be prevented by 30.4 per cent of the votes cast at an extraordinary general meeting, meaning it can be blocked by a combination of the Government and any shareholder with at least a 5 per cent stake in the company.

Ryanair declined to comment on the reports.

"We have a policy of not commenting on this process," said a spokesman.

Aer Lingus also said it would not comment on any report until the EU process was complete and a determination was made.