February 16, 2011
By Staff Reporter
By Andrew Bushe
DUBLIN — Up to 49 percent of Aer Rianta, which operates the country’s three main airports at Dublin, Shannon and Cork, should be floated on the stock exchange within the next three years, a special report to the government recommends.
Last year, Public Enterprise Minister Mary O’Rourke sought the strategic review of the company’s future to the year 2010. That report, entitled “Future Strategic Directive,” was made public on April 13 at Dublin’s Westbury Hotel.
Aer Rianta, the report says, needs to spend an more than _500 million on developing and upgrading the airports during the next five years.
The report also seeks authorization to prepare the state-owned Aer Rianta — the national airports authority — for an Initial Public Offering and recommends that it retain its profits to help fund the capital developments.
It also suggests the appointment of a regulator to deal with the setting of landing charges, which have been strongly criticized by Ryanair.
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Company chairman Noel Hanlon was dismissive of the complaints by Ryanair boss Michael O’Leary about the level of landing charges.
“Keeping his costs to make him a multi-millionaire, I mean why should the State make a private company _50 million to _60 million at the expense of the Exchequer,” Hanlon said. “Each _1 decrease Ryanair can get in their costs means increase in value of about _27 million to the Ryanair shareholders.
“Michael O’Leary should grow up and learn to be a big boy now that he is a multi-millionaire and pay a reasonable landing charge at Dublin Airport for the facilities which are provided which are among the best in Europe.”
The report recommends the sale of the company’s non-core Great South Hotels Group, which would bring in more than _50 million.
The hotels, which are all resort properties, will be sold as a group and not individually.
Aer Rianta should continue to seek duty free franchises abroad. The company will suffer a loss of about _30 million after tax if, as expected, the EU abandons duty free in June.
The company is ranked as the sixth largest duty-free retailer in the world and holds investments in Birmingham and Dusseldorf airports.
Chief Executive John Burke said the minister had appointed her own consultants to consider the company’s report.