Ryanair Loses U.K. Appeal to Block Probe of Aer Lingus Stake
Ryanair Holdings Plc (RYA) lost an appeal to block a U.K. probe into its 30 percent stake in Aer Lingus Group Plc (AERL) over claims it conflicts with a separate European Union review of plans to take over its Irish competitor.
The investigation into the minority stake by the U.K. Competition Commission doesn’t overlap the EU’s parallel review of Ryanair’s bid in June to purchase Aer Lingus for 694 million euros ($906 million), the Court of Appeal ruled today in London. The judgment affirms an antitrust tribunal’s ruling in August.
“Only the U.K. has jurisdiction in respect of Ryanair’s minority shareholding,” Judge Terence Etherton said in the ruling. The probe isn’t a breach of the U.K.’s legal duty to cooperate with European regulators.
Ryanair has been fighting with regulators since acquiring the Aer Lingus shares in 2006 as part of an earlier takeover bid that the 27-nation EU ultimately blocked on competition grounds. The European Commission issued formal objections last month to Ryanair’s new takeover bid, setting out possible competition concerns over the Dublin-based carriers combining.
Ryanair plans to “immediately” refer today’s ruling to the U.K. Supreme Court for review, the airline said in an e- mailed statement.
Rory Taylor, a spokesman for the London-based Competition Commission, said the agency is pleased with the ruling.
Colm Barrington, chairman of Aer Lingus, said in an e- mailed statement that the ruling “is a key milestone on the path toward Ryanair being required to divest its shareholding in Aer Lingus.”
Britain’s Competition Appeal Tribunal ruled in August that the commission in Brussels has no jurisdiction over the minority shareholding, making it proper for British regulators to investigate.
The two airlines carry more than 80 percent of the 370,000 passengers that travel between the U.K. and Ireland each month, regulators have said.
The minority stake gives Ryanair the ability to weaken Aer Lingus as a competitor and stifle investments from other airlines, the Office of Fair Trading, the U.K. regulator that referred the issue to the Competition Commission, said June 15.
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