Ryanair woos Irish government, staff in Aer Lingus bid

By Andras Gergely

DUBLIN (Reuters) - Ryanair (RYA.I)(RYA.L) offered guarantees to trade unions and the Irish government on Thursday to try and win them over to its 750 million euro ($946.4 million) offer for loss-making flagship carrier Aer Lingus (AERL.I)(AERL.L).

Europe's biggest budget airline is trying to appeal directly to the government and employees, who own over 25 percent and 14 percent of the airline respectively, after Aer Lingus's board this week rejected the all-cash offer -- the second in as many years.

Ryanair said it would give the Irish government control over Aer Lingus's valuable landing slots at London Heathrow airport and restore the Shannon-Heathrow route.

"By giving watertight control over Aer Lingus' (Heathrow) slots, we effectively remove any need for the Irish government to retain a strategic shareholding," Chief Executive Michael O'Leary told a news conference.

Ryanair tried to buy Aer Lingus for double the price of its current bid in 2006 but was thwarted by the European Commission, which ruled it would create a near monopoly in European flights out of Dublin.

Employees and the government also rebuffed Ryanair's earlier offer.

To allay competition concerns about its latest bid, made against a backdrop of a rapidly consolidating industry, Ryanair offered a 100 million euro guarantee that Aer Lingus's short haul fares would be reduced by at least 5 percent for three years and a similar guarantee that the former state carrier's fuel surcharges would be eliminated.

Analysts believe a recent spate of airline mergers and the absence of another suitor give Ryanair a better chance of getting this offer past competition authorities in Brussels.  Continued...