Brussels, 21/12/2006 (Agence Europe) - On 20 December the Irish low cost airline Ryanair decided to pursue its take-over bid of Aer Lingus no further. On the same day the European Commission announced that it had opened a detailed investigation under the EU Merger Regulation into this merger. Ryanair is, however, not giving up on the possibility of presenting a second offer if it gets the go-ahead from the Commission, whose verdict is expected in May 2007.
The Commission's initial market investigation indicated that the proposed acquisition “would raise serious competition concerns in the passenger air transport sector” and in particular could reduce choice for consumers and could give rise to higher fares. It therefore decided to launch an in-depth investigation. A Commission press release explained that on many routes the carriers are the only two competitors and the main operators out of Dublin airport. The proposed merger could lead to the elimination of actual and potential competition between the two carriers on a large number of routes out of Ireland as well as eliminate current base competition at Dublin airport. This explains the decision to launch the in-depth investigation. This announcement means that the “low cost” airline's bid becomes null and void but does not mean the company will be abandoning its project. The company explained in a Reuters' press release that “following the decision of Brussels to launch a phase II investigation, Ryanair's offer immediately becomes null and void. If the European Commission gives its authorisation at the end of this investigation, Ryanair wants to launch another offer for Aer Lingus”. (dt)