RYANAIR has been censured by the Irish Takeover Panel for breaching rule 16 of its code by giving guarantees last week to Minister for Transport Noel Dempsey that were not offered to all shareholders of Aer Lingus.
These included a guarantee that it would recognise trade unions at Aer Lingus, that it would give the Government control over the Heathrow slots and that it would post separate €100 million bonds payable to the Government if it did not deliver on its promise to cut Aer Lingus fares and abolish its transatlantic fuel surcharge.
Ironically, Aer Lingus took the rug from under Ryanair's pledge on the fuel surcharge by scrapping it yesterday with immediate effect.
Aer Lingus thus became the first airline worldwide to abolish the controversial surcharge, which applied to all its flights to and from the United States.
The levy was introduced by Aer Lingus in May 2006 to counter spiralling fuel costs. The airline has decided to drop the surcharge in light of the recent fall in oil prices to below $50 a barrel.
Aer Lingus carries just more than one million passengers on transatlantic flights and the charge ranged from €75 to €100 each way.
"Now that oil prices have fallen and stabilised over the past number of months, we believe the right thing to do is to remove these surcharges altogether," Aer Lingus said in a statement.
In its ruling on Ryanair's offers to the Government, the Takeover Panel said it constituted an arrangement "with an Aer Lingus shareholder containing favourable terms which were not being extended to all Aer Lingus shareholders".
The Takeover Panel said it had directed Ryanair that it was prohibited from extending these undertakings in its proposed offer.
In response, Ryanair said: "Morgan Stanley and Davy Corporate Finance, on behalf of Ryanair, strongly disagree with the decision of the Takeover Panel."
Ryanair said the Takeover Panel's decision seemed to render the Minister as "an inappropriate representative of consumer and stakeholder interests in Aer Lingus during an offer period".
Ryanair said it "remains committed" to providing these guarantees and would proceed with its €748 million offer "in a form consistent with the constraints imposed by the Takeover Panel".
Ryanair welcomed a ruling yesterday by the Takeover Panel to compel Aer Lingus to provide it with a copy of its shareholder register. It is understood that the share register was provided to Ryanair late yesterday.
Meanwhile, Aer Lingus last night dismissed rumours in the midwest that it is considering restoring the Shannon-Heathrow route, which it axed last year.
Aer Lingus indicated recently that it would look at launching new short-haul routes from Shannon after securing €50 million in cost cuts with its ground handling staff and cabin crew.
Speculation mounted this week that it could restore an early morning and evening service on the Shannon-Heathrow route.
However Aer Lingus told The Irish Times that it had no plans to restore the Shannon-Heathrow link.
Aer Lingus's shares closed down slightly yesterday in Dublin at €1.50 while Ryanair's share price declined by 3.8 per cent yesterday to €3.925.
