FLS Aerospace, the Danish company which is negotiating to buy TEAM Aer Lingus, has won two contracts worth almost £60 million. Meanwhile, workers at TEAM will receive formal offer letters from Aer Lingus on Monday, detailing their "transfer packages".
The letters will include details on how much the State airline is prepared to pay for the letters - every one of the 1,550 employees will receive offers ranging from £2,000 to £32,000 - as well as information on pension rights, terms and conditions. The package is worth £28 million.
In addition, the Minister for Public Enterprise, Ms O'Rourke, will meet TEAM management and unions on Monday to discuss the proposed sale.
The meetings are expected to be preliminary briefings on the positions of the two sides. FLS executives are expected to arrive in Ireland next week to begin the process of due diligence, while the unions are not meeting to determine their attitude to the sale until January 5th. Aer Lingus has said TEAM will not survive on its own and it is crucial for the company to find a strategic alliance partner. FLS Aerospace is owned by FLS Industries, which has a £2 billion annual turnover.
FLS said yesterday it had secured two new maintenance contracts worth a total £56.5 million.
The contracts were for maintenance services for United States' Continental Airlines and Britain's Caledonian Airways. The largest was worth £34 million.
The Continental Airlines deal involves maintenance of the carrier's fleet of DC-10 aircraft for a three-year period, FLS said. The Caledonian Airways contract involves maintenance of two DC-10 and six Tristar aircraft.
FLS Aerospace, which is based in Britain, at Heathrow, Manchester and Stansted, said the latest contracts brought total new orders for the unit up to £200 million. TEAM has an annual turnover of around £85 million, but should turn a profit by next year.
The unions have signalled strong reservations about the sale of TEAM and said the £25 million buy-out package for Aer Lingus employees in TEAM is inadequate.
They also say that they cannot negotiate on the Letters of Guarantee, which three quarters of TEAM's 1,550 employees hold from Aer Lingus. These will have to be dealt with on an individual basis, between management and employees, many of whom have initiated High Court actions to defend the rights outlined in the letters.
Interestingly, the aerospace division's parent company FLS Industries has a long connection with Ireland.
The engineering group was involved in setting up Irish Cement in Drogheda and Limerick in the late 1930s. It still supplies processing and engineering equipment to Irish Cement factories.
