June 18 (Bloomberg) -- Ryanair Holdings Plc, Europe’s biggest discount airline, is facing a full investigation of its 30 percent stake in Irish competitor Aer Lingus Group Plc after a U.K. regulator said the holding may lead to higher prices.
The U.K. Competition Commission said today it will probe the six-year-old minority share deal after it was flagged for review by Britain’s Office of Fair Trading. The stake gives Ryanair the ability to weaken Aer Lingus as a competitor and stifle investments from other airlines, the OFT said June 15.
The Competition Commission will decide by Nov. 29 “whether the acquisition may be expected to result in a substantial lessening of competition in any market” in Britain, the London-based watchdog said in today’s statement.
Ryanair has been fighting with regulators over the stake since it acquired the shares in 2006 as part of a takeover bid that was ultimately blocked by the European Union. The airlines carry more than 80 percent of the 370,000 passengers that travel between the U.K. and Ireland each month, the OFT said.
“We do not believe that this is a sensible or useful expenditure of U.K. taxpayers’ monies or resources,” Ryanair Chief Executive Officer Michael O’Leary said in a statement last week. The same comment applies today, the company said.
Aer Lingus supports the review, the carrier’s CEO, Christoph Mueller, said in a statement last week.
The U.K. Court of Appeal ruled June 1 that Ryanair didn’t have the right to challenge a lower court ruling that the OFT was entitled to seek a full probe from the Competition Commission, which is the U.K.’s “second-phase” antitrust watchdog.
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