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The government owns a 25.4 per cent stake in Aer Lingus - but is willing to sell its shareholding, according to Leo Varadkar. Niall Carson/PA Archive

Varadkar willing to sell off State’s stake in Aer Lingus

The Transport minister tells Newstalk that he doesn’t view the airline as “strategic” – and would be willing to part with it.

TRANSPORT MINISTER Leo Varadkar has given the clearest indication yet that the State is about to sell off its stake in Aer Lingus – saying he no longer believes the airline is a vital strategic asset.

Speaking on Newstalk’s Breakfast show, the minister said the government was not willing to part with assets it considered ‘strategic’ for the operation of the country – but that he no longer felt Aer Lingus could be deemed indispensible.

“What I can say is that that stake, in the past, was held for strategic reasons,” he said. ”Having studied the matter over the summer I don’t think that really stands any more.”

He added that the airline’s landing slots at Heathrow Airport, which were previously treated as a prize asset, were now less important than they had previously been considered.

Irrespective of this, he added, the government would have to keep a 30 per cent stake in the airline if it was to use its voting rights to block the sale of the landing slots – and that the state only owned 25.4 per cent of the airline as it is.

Varadkar insisted, however, that no formal decision on the disposal of Aer Lingus had been made by the cabinet.

Ryanair, which is the largest shareholder in Aer Lingus with a 29.4 per cent stake, said this afternoon it would not bid for the government’s stake, if it deemed a Ryanair offer to be “unwelcome”.

It added that if the government’s stake was to be bought by a “financially strong airline or investor”, it “would not rule out” holding talks them to arrange the sale of Ryanair’s own part-ownership.

European competition authorities have previously blocked Ryanair from increasing its stake in its rival.

Trade union IMPACT, which represents pilots and cabin crew at Aer Lingus, said the sale of the airline “would have long-term consequences for the Irish economy, particularly at a time when tourism and exports are key to recovery and sustained economic growth”.

Its national secretary Matt Staunton said the government should be “mindful of the lessons of the past” in ensuring that it valued the highly sought-after Heathrow landing slots appropriately.

He also said Varadkar’s argument about a 30 per cent shareholding being needed to block a sale was not a sound one on which to abandon the government’s existing 25.4 per cent shareholding.

Colm McCarthy’s report on the sale of state assets listed Aer Lingus as one of the items it believed should be sold off as soon as circumstances allowed. The government hopes to raise €2bn through the sale of some state assets.

Varadkar separately told Newstalk that the government would pursue the part-privatisation of some assets, and refused to comment on whether CIE would be one of the entities it would sell some shares in.

Shares in Aer Lingus were trading at 68c each at the time of publication, giving the airline a total market value of €377m, and leaving the government’s shareholding worth around €95m.

Shares closed yesterday valued at 63.5c each.

Earlier: Aer Lingus reports surge in passenger numbers >

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    Mute Ben Redline
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    Aug 7th 2015, 4:47 PM

    I kinda wish the Robot was fitted with pepper spray.

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    Mute stephen
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    Aug 7th 2015, 8:39 PM

    Kinda,, o man I wish. Little brats.

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    Mute Seth Mcguinness
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    Aug 7th 2015, 4:55 PM

    Human on robot violence is a relatively new phenomenon.

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    Mute Kal Ipers
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    Aug 7th 2015, 5:01 PM

    It depends on what you call a robot because the Luddites were pretty violent on what technically were robots

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    Mute thejynxeffect
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    Aug 7th 2015, 11:26 PM

    Some people shoot drones out of the sky

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    Mute Rod_TenⒸ
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    Aug 7th 2015, 4:46 PM

    Thank god it’s not one of DOB’s robots or his lawyers would have sent the kids an angry letter.

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    Mute selfsustainable
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    Aug 7th 2015, 4:48 PM

    Kinda sums up present world society pretty well.

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    Mute john kinsella
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    Aug 7th 2015, 10:56 PM

    There parents should have given them hammers. That thing will probably do them all out of a job in the future.

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    Mute Stephen M
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    Aug 7th 2015, 5:01 PM

    He’ll get them back when he gets his aerial drone upgrade.

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    Mute Liam Brophy
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    Aug 7th 2015, 4:47 PM

    Chappie ?

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    Mute The Girl
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    Aug 7th 2015, 4:48 PM

    Because human empathy is dying off. Have you seen the violence in some of the computer games and cartoons? Tom and Jerry? Hit people you don’t like with anything available. Your hands included. What a wonderful world.

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    Mute Beachmaster
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    Aug 7th 2015, 4:59 PM

    Please, tell me more about this pre-video game/cartoon world where human empathy was so much more prevalent, there was no violence and it rained jelly babies.

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    Mute Laura Walsh
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    Aug 7th 2015, 4:59 PM

    Don’t forget Itchy and Scratchy!

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    Mute Rod_TenⒸ
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    Aug 7th 2015, 5:15 PM

    Jelly babies were originally marketed as unwanted babies

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    Mute Larissa Caroline Nikolaus
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    Aug 7th 2015, 7:46 PM

    While I agree that some video games are far too violent, to lump Tom & Jerry into this is just crazy.

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    Mute Derry Seery
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    Aug 7th 2015, 9:02 PM

    Haha, it’s really not that crazy! The original Tom & Jerry’s that they show on Boomerang are ridiculously violent, especially when you consider the target age groups.

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    Mute Jack DaCosta
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    Aug 7th 2015, 4:48 PM

    LOL!
    The ring a ring a rosie thing on 25 seconds is hilarious.
    Kids are mad.

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    Mute Brian Jimp
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    Aug 8th 2015, 11:02 AM

    Those kids have cleverly preempted Skynet.

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    Mute flint
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    Aug 7th 2015, 7:59 PM

    frag out!!

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