RYR told to sell its part of Aer Lingus

http://www.independent.co.uk/news/business/news/ryanair-ordered-to-reduce-aer-lingus-stake-8787610.html

Extracts :


Ryanair's 30 per cent stake in Aer Lingus damages competition on routes between Britain and Ireland and must be cut to 5 per cent, a regulator has ordered.
The Competition Commission said the shareholding, which Ryanair has held for seven years, weakens its main competitor and could prevent Aer Lingus from combining with another airline in order to build scale.

Ryanair boss Michael O'Leary said the company will appeal against the ruling and called the report "bizarre and manifestly wrong".

Aer Lingus chairman Colm Barrington said the ruling showed that its main rival's shareholding went against the interests of 14 million passengers flying between Ireland and the UK.

Mr O'Leary said the decision had been expected and that the UKCC had made its mind up in advance.

"This prejudicial approach to an Irish airline is very disturbing, coming from an English government body that regards itself a model competition authority," he said.

Mr O'Leary added: "It would appear to be a case of one rule for the UK airlines but an invented set of rules for two Irish airlines."

The competition watchdog has also ordered Ryanair not to seek or accept board representation or acquire further shares in Aer Lingus.

Simon Polito, the commission's deputy chairman and chairman of the Ryanair/Aer Lingus inquiry group, said there is intense competion between the two airlines for passengers between Ireland and the UK.

He said rivalry for customers was as strong now as when Ryanair started its share buy-up in 2006.

'However, we consider that there is a tension between Ryanair's position as a competitor and its position as Aer Lingus's largest shareholder, and that Ryanair has an incentive to weaken its rival's effectiveness as a competitor," Mr Polito said.

If Ryanair is no more a shareholder in Aer Lingus, it seems that Ryanair will have a still greater incentive to weaken its rival !
There could be a fare war on flights to/from Ireland - all the better for the customers.
But first, it remains to be seen if there a buyer can be found, and who it will be ...

http://www.ryanair.com/ie/news/ryanair-will-appeal-ukcc-report-on-7-year-old-aer-lingus-minority-stake

Extracts :

Ryanair today (28 Aug) confirmed that it will appeal the UK Competition Commission (UKCC) final report which wrongly found that Ryanair, through its 7 year old minority (29.8%) shareholding in Aer Lingus, “had led or may be expected to lead to a substantial lessening of competition between the airlines on routes between Great Britain and Ireland”. This baseless claim is manifestly disproven by 7 years of evidence and by the European Commission’s recent (Feb 2013) ruling that competition between Ryanair and Aer Lingus has “intensified” since 2007.
Under EU law, the UKCC has a duty of sincere cooperation with the EU, and cannot contradict or reach different conclusions to the European Commission’s findings. Inexplicably, today’s report by the UKCC infringes this legal duty by ignoring and contradicting the recent findings of the European Commission.
In addition, the UKCC has inexplicably dismissed Ryanair’s unprecedented remedies package which comprehensively addressed the UKCC’s three invented “concerns”.
The UKCC’s manifestly unjust ruling demonstrates that it did not conduct any fair investigation and that it has now merely announced what was its pre-determined conclusion. Ryanair will appeal the UKCC’s unlawful ruling to the UK Competition Appeal Tribunal. In any event, until the completion of Ryanair’s appeal to the EU courts against the European Commission’s February 2013 prohibition decision, the CC cannot lawfully impose any remedies on Ryanair.


Ryanair’s Michael O’Leary said:
“This report by the UKCC is bizarre and manifestly wrong but also entirely expected. From the first meeting with the UKCC it has been clear to us that Simon Polito’s and Roger Davis’ minds had been made up in advance and no truth or evidence was going to get in the way of their story.
While Ryanair is one of the UK’s largest airlines, Aer Lingus has a tiny presence in the UK, serving just 6 routes to the Republic of Ireland, a traffic base that has declined over the past 3 years and now accounts for less than 1% of all UK air traffic. This case, involving two Irish airlines where one (Aer Lingus) accounts for less than 1% of the UK’s total air traffic and concerns very few UK consumers, is yet another enormous waste of UK taxpayer resources from a body which took no action whatsoever when the two main UK airlines (BA and bmi) merged. It would appear to be a case of one rule for the UK airlines but an invented set of rules for two Irish airlines.