Aer Lingus CFO doubts whether Ryanair will sell stake
Andrew Macfarlane says Ryanair's 30 percent stake is "not appropriate"
By Jaimie Kaffash | CFO UK | Published 13:24, 02 March 12
The chief financial officer of Aer Lingus has cast doubt on Ryanair's commitment to sell its "inappropriate" 30 percent stake in the company at the same time as the Irish government.
Andrew Macfarlane (pictured) was speaking to CFO World following the Irish airline's results announced on Thursday.
Ryanair, its main rival, holds a 29.8 percent stake in Aer Lingus, and the Irish government holds 25 percent of the shares. The Irish government has said it will look for a buyer and Ryanair said it will consider selling its stake to whoever buys the government's shares.
However, Macfarlane said he was uncertain whether Ryanair would be open to offers. "The Irish government has not committed themselves to timings so I think it is when they see an attractive price in the market," he said.
"I'm not sure Ryanair will sell. They have been a bit inconsistent. We would prefer it if they are not on our register. It is not really appropriate to have your largest competitor as your largest shareholder."
There are currently processes underway with the Office of Fair Trading in the UK and a high court case in Ireland, Macfarlane said. "It may take some time to get to the resolution."
However, he added, "The shareholding issues don't have an adverse effect on our day-to-day operations or decision making."
Stephen McNamara, communications manager at Ryanair, told CFO World: "We'd be interested in discussing our holding with anybody who might be purchasing the government stake. That hasn't changed.
Macfarlane said that the results announced on Thursday – an operating profit of €49.1 million, a 6 percent decrease on 2010 – were "excellent results" in the market conditions.
This year would see a similar decrease in profits, he added. "We think oil prices are likely to stay reasonably high, so we're expecting an increase in our fuel bill of about €60 million. What we are saying is that we expect to be significantly profitably but at a lower level than 2011. IAG gave the same sort of guidance," he said.
The company's cost-cutting programme was on course, Macfarlane added. "The three year goal was to get €97 million of sustainable cost savings. We got €84 of that by September and we'll get the rest by the middle of next year."
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