International Consolidated Airlines Group (IAG) will give a guarantee on Aer Lingus’s Heathrow slots if a takeover bid is successful, the company’s chief executive Willie Walsh has said.
Mr Walsh is appearing before the Oireachtas Transport Committee today as he continues to press the case for the group’s €1.36 billion bid to buy Aer Lingus.
He also said there was “no reason for anyone to be concerned” about the future of the Heathrow routes to Cork and Shannon.
Mr Walsh said a perception has been created that IAG wants to take slots from Aer Lingus and and use them to expand British Airways long-haul network.
But he said 229 of BA’s slots, 73 per cent of their total, are being operated on short haul services. He added that IAG has “more than enough” slots to expand BA’s long haul network without using Aer Lingus’s.
Mr Walsh, a former Aer Lingus pilot who went on to lead the company between 2001 and 2005, said Aer Lingus fits “very well” with IAG. He said the airline has a very strong brand in Ireland, the east coast of the USA and the UK.
He said Aer Lingus is an efficient airline working in a competitive market and it represents a growth opportunity for IAG.
He said IAG would put its strength behind Aer Lingus in order to increase the company’s transatlantic trade.
He said he thought “Aer Lingus has done a good job. I think Aer Lingus has opportunities to grow, I think the opportunities to grow are secure by being part of IAG”.
He added: “We’re operating in a very competitive industry that is consolidating. Aer Lingus is a small carrier in global scales… its opportunities are much more interesting and significantly better as part of IAG than it is alone”.
Mr Walsh said IAG has a history of working with regional franchise operators and that British Airways could enhance the value of relations between Knock airport and Gatwick.
Earlier, Mr Walsh met Minister for Transport Paschal Donohoe to discuss IAG’s proposed €2.55 a-share offer for the Irish airline. He said the airline is “nowhere near” walking away from its bid despite opposition to the proposed deal from some politicians.
The Government holds a 25.1 per cent stake in the business on behalf of the State, while the Dáil has to approve any sale of that interest.
IAG is offering the Government and business groups a legally-binding veto over the sale of the airline’s landing and take-off rights at Heathrow Airport, which are seen as critical to international access.
It is also willing to guarantee that they will be used exclusively to service Irish routes for five years.
Elsewhere, Taoiseach Enda Kenny said he had not heard the outcome of the Oireachtas transport committee meeting today with Mr Walsh.
He was responding to reporters’ question about the takeover bid when he said, “I spoke to the Minister for Transport yesterday who had a briefing from Willie Walsh but I would assume that there would be far more detailed questioning brought up at the Oireachtas committee on transport chaired by deputy [John] O’Mahony.”