UPDATE 1-Ireland opposed to Ryanair bid for Aer Lingus

Padraic Halpin
Reuters Middle East

* Government rebuff a blow to Ryanair

* Ultimate decision lies with European Commission

* Ryanair says has offered "unprecedented remedies package"

DUBLIN, Dec 18 (Reuters) - The Irish government has decided

to oppose Ryanair's bid to take over Aer Lingus

after studying details of the plan, the country's transport

minister said on Tuesday in a blow to the budget airline's


The European Commission, which is probing the 694 million

euro ($917 million) bid on competition grounds and will have the

ultimate say early next year, sent Ryanair a list of objections

to the tie-up last month.

Ryanair has offered fresh concessions, which include an

offer to sell some of Aer Lingus' landing slots at London's

Heathrow airport to British Airways and slots elsewhere to Flybe

, according to a person familiar with the matter.

"The Ryanair offer and at least the remedies that are being

reported are not sufficient in our view, so we won't support

their bid and, in addition, won't co-operate with their remedies

package," Transport Minister Leo Varadkar told journalists.

"The Commission will make its own decision, but we have

given our views and they are around connectivity, competition

and employment. We don't see any advantages for Ireland in

what's being proposed and we see very significant potential


Varadkar, who reiterated the government's intention to sell

its own 25 percent stake in the former state carrier and said

advisers will be appointed in the New Year, would not comment on

what aspects of the remedies package the government opposed.

When asked about the remedies package, BA, which is part of

the International Consolidated Airlines Group, said it

had signed a non-binding memorandum of understanding with

Ryanair which is subject to EC approval as part of the review of

the Ryanair-Aer Lingus deal.

Ryanair, which already owns 30 percent of Aer Lingus, said

in a statement that as Dublin owns just 25 percent of the once

dominant airline, it has no power to block the offer, adding

that it had submitted an "unprecedented remedies package".

In its first package of concessions, Ryanair secured

commitments from airlines to set up bases in Dublin, and said it

would scrap some routes it and Aer Lingus currently fly from


The Commission blocked Ryanair's first takeover bid for Aer

Lingus in 2007. The Irish budget airline dropped a second offer

in 2009.

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