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Aer Lingus stock float is delayed

February 16, 2011

By Staff Reporter

By Andrew Bushe

DUBLIN — The Aer Lingus flotation is not expected to take place until next year due to legislative delays.

Public Enterprise Minister Mary O’Rourke said the Aer Lingus Bill had passed through all stages in the Seanad, but pressure of other business had squeezed it out of the Dail program before TDs broke up for their summer holidays.

She said she had fought hard for Dail slots for the bill from Chief Whip Seamus Brennan.

"It was simply that the mathematics of time didn’t allow it," O’Rourke said.

The holiday will be longer than usual this year. The Dail will not return until October due to extensive renovation of Leinster House. This will mean a further delay.

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O’Rourke denied it was a setback and said her plan had always been to have the IPO in late 2000 or early 2001, depending on market conditions.

Aer Lingus, which is looking for funding from the flotation to buy new aircraft and expand routes, had been seeking the earliest possible date for the flotation.

The airline has yet to finalize a deal with the unions on what share of the company workers will hold and also to agree on pension arrangements.

The minister denied suggestions that she was being "tardy or fainthearted" about the IPO as a result of recent collapse in Eircom shares.

Almost 500,000 people made their first foray into stock ownership when they bought shares in the former state telephone company.

They have seen their investment nest eggs plunge in value in recent weeks. The shares have dropped to 2.70 euros — well below last summer’s launch price of 3.90 euros. As a result, people are not expected to rush to buy Aer Lingus equity.

O’Rourke pointed out that, in four months since the Eircom launch, people could have sold Eircom and taken a 20 percent profit.

She said it was "completely untrue" that the government was only lukewarm about the Aer Lingus sell-off.

"That is a complete fabrication. The cabinet have passed everything I have brought to them. There has never been an argument or dissent about it," she told RTE.

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