Aer Lingus has rejected Ryanair’s takeover bid, claiming its rival’s third offer for the airline in six years was not credible.
The Irish flag carrier claimed Ryanair’s €694m bid "fundamentally undervalued the business". Ryanair claims that if the takeover went ahead it would create jobs, but Aer Lingus said it was unlikely to be approved by Europe’s competition watchdogs as it would leave Ryanair with a monopoly on a large number of routes.
In a statement, it said: "Ryanair’s 2006 offer was prohibited by the European Commission on competition grounds, and your Board believes that the reasons for prohibition are now even stronger than before: the number of routes that Ryanair would monopolise has sharply increased.
"Your Board has received legal advice that the European Commission is likely once more to prohibit the Ryanair Offer, and that this is not therefore a credible Offer which is capable of completion."
Aer Lingus said it would write to shareholders to set out in detail its reasons for rejecting the offer.
The UK Competiton Commission will hear a case on Friday into Ryanair’s existing 30% stake in Aer Lingus.
