30th Mar 2007 14:26
Ryanair Holdings PLC30 March 2007 RYANAIR DESCRIBES LEAKED EU FINDING AS BIZARRE, UNPRECEDENTED AND POLITICALLY MOTIVATED Following the leak of confidential material to a media source in Brussels,Ryanair, Europe's largest low fares airline today (Friday, 30th March 2007)seriously questioned the European Commission's latest comments on its Aer Lingusbid. The airline also criticised the leaking of this confidential report to themedia. Ryanair stated that these findings run contrary to the EuropeanCommission's stated policy of supporting airline consolidation, are notsupported by evidence, and are bizarre from a Commission which has previouslyapproved mergers between Air France and KLM, Lufthansa and Austrian, andLufthansa and Swiss Airlines. These findings fly in the face of these EU airlineprecedents, and are clearly designed to appease the political interests of theIrish Government, rather than advancing the interests of Irish consumers andvisitors. Ryanair said that the EU's findings which suggested that a merger between AerLingus and Ryanair "is likely to significantly impede effective competition" areunsupported by the facts in this case which include Ryanair's commitments to; 1. Reduce Aer Lingus's fares each year for a four year period. 2. Reduce Aer Lingus's fuel surcharges. 3. Improve Aer Lingus's fleet and product. 4. Significantly reduce Aer Lingus's cost base. Ryanair firmly believes that the measures proposed for Aer Lingus will generatesubstantial savings which will be passed on to consumers, because they will leadto reduced prices, improved services, as well as providing Aer Lingus with astrong financial partner. No such commitments were given in the far larger AirFrance-KLM takeover which was approved by the Commission and has since seenlarge fare increases and fuel surcharges. At a time of increasing EU airlinetakeovers and consolidations, these bizarre findings fly in the face of allprecedent decisions in the European airline industry and also run counter to theinevitable wave of further consolidations which EU-US Open Skies will bringabout. Ryanair's Spokesman, Peter Sherrard, today said: "These findings by the European Commission are clearly politically motivated. It is untenable for DG Competition - which has previously approved the €3.8bn Air France takeover of KLM, and the Lufthansa takeovers of Swiss and Austrian Airlines - to suggest that the much smaller Ryanair takeover of Aer Lingus will impede effective competition, when Ryanair has already offered to guarantee fare reductions, fuel surcharge reductions and improved services. These findings also fly in the face of the wave of national consolidations which have and continue to take place across Europe and have seen: a. •Ryanair previously acquire Buzz in the UK. b. •SN Airlines acquire Virgin Express in Belgium. c. •Air Berlin buy Deutsche BA in Germany. d. •BA dispose of BA Connect to FlyBe in the UK. e. •Air Berlin buy LTU in Germany. f. •Tap buy Portugalia in Portugal. "At a time when British Airways is considering purchasing BMI, when Iberia is the subject of takeover approaches from British Airways, Air France and Lufthansa, when Alitalia is the subject of takeover approaches by Lufthansa and Air France, the suggestion that two Irish airlines - which combined, account for less than 5% of EU air travel - should not be allowed to merge is a bizarre and clearly political, rather than a competition position. "It is clear that the EU Competition Commission is applying a different and unique standard to the Ryanair-Aer Lingus offer which flies in the face of all previous decisions and runs contrary to the wave of mergers and takeovers which is now in train following EU-US Open Skies. EU-US Open Skies opens both Ryanair and Aer Lingus to the possibility of far more intense competition at Dublin from major American airlines. Aer Lingus needs to find a strong financial partner if it is to compete effectively against the US and European mega carriers. Ryanair can provide that strong financial partner, at a time when Aer Lingus has withdrawn from BA's One World Alliance. "It is unfair of the European Commission to apply different rules and a different standard to Ryanair's merger with Aer Lingus than it previously applied in the larger Air France or Lufthansa mergers. How can the European Commission subsequently approve takeovers of Iberia or Alitalia, when it makes what is clearly a politically motivated decision to block Ryanair's much smaller offer for Aer Lingus? It appears that yet again the European Commission has one set of rules for flag carrier airlines, and a different, unique set of rules for efficient low fare airlines like Ryanair. We call on the European Commission to stop this politically motivated interference in the Ryanair-Aer Lingus offer, and apply its own competition rules fairly. This merger should be approved without further delay or interference, as part of the continuing wave of European airline consolidation". Ends. Friday, 30th March 2007 For reference: Pauline McAlester Murray Consultants Telephone: +353 1 498 0300 The directors of Ryanair accept responsibility for the information contained inthis announcement, save that the only responsibility accepted by the directorsof Ryanair in respect of the information contained in this announcement relatingto Aer Lingus and the Aer Lingus Group, which has been compiled from publishedsources, has been to ensure that such information has been correctly and fairlyreproduced or presented (and no steps have been taken by the directors ofRyanair to verify this information). To the best of the knowledge and belief ofthe directors of Ryanair (who have taken all reasonable care to ensure that suchis the case), the information contained in this announcement for which theyaccept responsibility is in accordance with the facts and does not omit anythinglikely to affect the import of such information. 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