IAG Said Willing to Improve Aer Lingus Pledges to IrelandAaron Kirchfeld, Joe Brennan and Kari Lundgren
British Airways parent IAG SA would consider improving commitments made last week to help win government backing for a planned offer for Ireland’s Aer Lingus Group Plc, according to people familiar with the situation, as IAG Chief Executive Officer Willie Walsh prepared to be quizzed by lawmakers in Dublin.
Should the Irish government communicate additional demands, then London-based IAG is open to revising its proposal, which so far includes guarantees not to sell Aer Lingus’s slot pairs at Heathrow or drop the carrier’s brand, said the people, who asked not to be identified because talks are private. A spokeswoman for IAG declined to comment.
IAG CEO Walsh will be questioned by lawmakers on the Irish parliament’s transport committee in a public hearing on Thursday in Dublin at 2 p.m.
“The committee welcomes the chance to hear directly from Willie Walsh on IAG’s bid for Aer Lingus,” said John O’Mahony, chairman of the group, in an e-mail statement. “The committee remains anxious to ensure that any decision taken by government in relation to a potential takeover is based on securing the strategic interests of the country.”
Ireland’s government is preparing to reject IAG’s indicative offer for its 25 percent stake in Aer Lingus, a person familiar with the situation said yesterday. A final decision has yet to be taken. Other concessions that IAG has made include a guarantee that it would operate slots on Irish routes for five years. The company hasn’t specified any plans for job security, a key element for the Irish government.
Walsh is seeking to overcome mounting political resistance to the proposed takeover of an airline he ran until 2005. To support his push, Walsh also plans to meet the government review group, one of the people said.
London-based IAG says it won’t proceed without the endorsement of the Irish administration, with the two coalition parties trailing in the polls a little over a year before a scheduled general election.
The Aer Lingus board said on Jan. 27 that it was prepared to recommend an indicative offer of 2.55 euros per share from IAG, as International Consolidated Airlines Group SA is known, having rebuffed two earlier approaches. The offer values the Irish carrier at about 1.36 billion euros ($1.54 billion).
Aer Lingus rose 0.9 percent to 2.13 euros at 4:30 p.m. in Dublin trading, giving the carrier a market capitalization of 1.14 billion euros.