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Aer Lingus has advised its shareholders to reject a EUR694m takeover bid from low cost carrier Ryanair, claiming that it undervalues the Irish flag carrier.
Ryanair launched a EUR1.30 per share all-cash offer on June 18 for Aer Lingus, which it says represents a 38 per cent premium on its closing share price on the day of the bid.
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Ryanair said that with the large scale consolidation of airlines in Europe that its proposal was best for Aer Lingus’s “long-term future, its brand and growth prospects” and that it would create “one strong Irish airline group”.
Aer Lingus urged shareholders to reject the offer, saying that it undervalued the carrier.
The offer comes after Abu Dhabi based Etihad Airways acquired a three per cent stake in Aer Lingus and expressed an interest in taking the Irish government’s remaining 25 per cent stake in the airline.
Ryanair is already the largest shareholder in Aer Lingus with a 29.8 per cent stake gained from a 2006 takeover attempt.
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