![]() ![]() The Aer Lingus slots at Heathrow would not be sold even to other IAG airlines. ![]() IAG's CEO Willie Walsh (himself a former CEO of Aer Lingus) spoke before the Oireachtas (the two houses of parliament) promising that IAG would guarantee: Once IAG achieved the nod of agreement from the Aer Lingus board it has tried to assuage the political fears. From our analysis it seems likely that the EI slot portfolio at that airport could be worth £250m or a quarter of the value that IAG is offering for the company. ![]() The valuation of slots at Heathrow is a particularly arcane subject - Aviation Strategy has been involved in a number of projects in the past few years to validate valuations of slots at the airport. Following BA's acquisition of BMI in 2012, EI is the third largest operator by movements at London Heathrow after BA and Virgin Atlantic. The Heathrow slots are probably the most valuable of all Aer Lingus's assets. From a strategic point of view the Irish government wants to ensure that there are sufficient connections from Dublin, Shannon and Cork into London's hub airport to guarantee long haul connections from Ireland to the rest of the world through Europe's prime gateway. When the airline was privatised eight years ago the government retained a 25% stake but insisted that it had a veto on any sale or transfer of slots at Heathrow. Now IAG has weighed in with a bid to acquire the company finally persuading the board to recommend an offer of €2.55 a share (including a €0.05 per share dividend) valuing the company at €1.3bn. Etihad meanwhile built a modest investment and tried to interest Aer Lingus in its peculiar alliance strategy. The takeover attempts by Ryanair have consistently been politically rebuffed at local, EU (and, strangely, UK) levels. Within weeks of the initial flotation local competitor Ryanair had launched a bid at €2.80 a share, and eventually built up a stake of 29% in the Irish flag carrier. Aer Lingus: pricing the Shamrock Jan/Feb 2015Īer Lingus' independence has been in question since it was privatised in 2006 through an IPO on the Irish stock exchange (at €2.20 a share). ![]()
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