Ryanair vowed today to pass control of Aer Lingus’s Heathrow slots to the Dáil if the second bid for its rival gets the go-ahead.
The company initially pledged to give the Government, which has a 25 per cent
stake in the former national carrier, control of the valuable slots.
But the State’s takeover watchdog claimed the commitment breached stock market rules by favouring one shareholder and could not go ahead.
Ryanair chief executive Micheal O’Leary today appeared before the Joint Oireachtas Transport Committee to detail his takeover bid.
Mr O'Leary claimed there were three dominant airlines in Europe - British Airways, Lufthansa and Air France - and none was interested in Aer Lingus.
He said Ryanair’s ethos was one of growth while continuously driving down fares and costs.
“Ryanair’s offer guarantees not only to secure the Heathrow slots for Ireland, but we will transfer control of those Heathrow slots to the Houses of the Oireachtas,” he said.
Last week the Irish Takeover Panel said Ryanair had breached merger rules by putting forward certain assurances to bolster its bid.
Ryanair has offered to buy Aer Lingus for €747.5 million - around half the sum tabled in its first failed bid two years ago.
Mr O’Leary claimed he would create 1,000 jobs, secure the Heathrow slots, recognise unions at the airline and place a €100 million guarantee to slash fares by 5 per cent over three years if the bid gets the go-ahead.
There would also be a similar guarantee over eliminating fuel surcharges.
He warned the former national carrier’s future was bleak unless Ryanair is allowed to step in and to prop it up.
“What we have is an airline that is losing money, cutting flights, cutting routes, cutting jobs, cutting pay,” Mr O’Leary said.
“The only thing they haven’t cut is the air fares.
“Aer Lingus has a very bleak future without Ryanair.
“They are doomed to a future where they will remain a sub scale flag carrier, isolated and uncompetitive.”
But Aer Lingus boss Dermot Mannion rubbished Mr O’Leary’s claims that the airline was crumbling, insisting it was going to break even in the second half of 2008.
He quoted a statement at the committee from one of Ryanair’s financial advisers that Aer Lingus would not go out of business.
“The chances of Aer Lingus going bust are zero,” Mr Mannion said.
“It is more likely that their competitors will go bust, that’s what Ryanair’s own advisers are saying.
“Aer Lingus is without question the most successful flag carrier in Europe.”
Ryanair’s chief financial officer, Howard Miller, told the committee that under their revised proposal nothing would happen to the slots without a vote from both Houses.
“I can’t see how the takeover wouldn’t be happy with that,” Mr Miller said.
“If the takeover panel were to express a view that they wouldn’t be happy with it, in effect what they are saying is that the Houses of the Oireachtas is one and the same as the Irish Government.”