Minister for Transport Noel Dempsey has told Clare County Council that Aer Lingus shareholders are not entitled to overrule management decisions on business issues through resolutions at extraordinary general meetings (egm).
The Aer Lingus board is considering a new request from Ryanair to hold an egm to consider a resolution demanding that its Shannon-Heathrow service be maintained.
Last Wednesday, after meeting Mr Dempsey, the Atlantic Connectivity Alliance (ACA) called on the Government to use its shareholding to reverse the controversial Aer Lingus decision at the proposed egm.
However, in his letter circulated to councillors at last night's meeting, Mr Dempsey said: "Aer Lingus is a private company and has to take its own commercial decisions". On over-ruling management decisions at an egm, he said that company directors "are not obliged, as a matter of law, to follow any directions from the shareholders in relation to business matters or to obey any resolution with regard to such matters".
He added: "The Government's shareholding does not confer on me a right to influence commercial operations of the company. In the circumstances, it would be inappropriate for me to directly intervene and to do so would ultimately be damaging to the airline and its customers".
He continued: "The State retained a 25 per cent ownership in Aer Lingus to protect strategic interest. The primary concern in this context was to provide a basis to oppose a takeover of the company that may not have been in Ireland's strategic interests. The value of the State's stake in this context has already been demonstrated. As a 25 per cent shareholder, the Government has no role in the day-to-day management of the company."
He added: "Ireland's economic interests are well served by the existing competitive aviation market in which Aer Lingus is a major player. A weak Aer Lingus, without access to equity, would have damaged the airline's prospects and none of the air services provided would have been secured."
About 2,500 letters were sent to the six Government TDs in the midwest yesterday calling on them to lobby the Taoiseach and ministers to retain the service.
