Michael O’Leary tends to be a CEO that polarises public opinion, but no one can doubt his achievement in taking Ryanair, the low cost Irish carrier founded in 1985, from a small provincial operation to one of Europe’s largest and most profitable airlines.
Late yesterday the company announced its most recent attempt to take over Aer Lingus, Ireland’s listed flag carrier, via an all cash offer of €1.30 per share, valuing the business at €700 million.
This is a path well-trodden by O’Leary and Ryanair, having acquired 25% of Aer Lingus within 6 months of the company going public on the Dublin and London Stock Exchanges in September 2006, and then twice more increasing the stake they held.
Another 4% was acquired in August 2007, with a further 0.6% being purchased in July 2008. However, Ryanair’s attempt at a full takeover has previously been blocked by EU regulators.
The latest bid is backed with rhetoric as to its merits, including references to BA’s recent takeover of BMI as continued consolidation within the EU airline industry, and the fact that the Irish government has committed to selling its 25% stake as part of the terms of the EU bailout.
Sit tight and put your seatbelts on as this deal could well experience some turbulence…