Ireland’s Aer Lingus to be Privatized

May 19, 2005

Ireland’s Aer Lingus to be Privatized
May 19, 2005 – Ireland has announced that it will privatize its state-owned airline, Aer Lingus, and build a new terminal at the Dublin Airport. In a compromise agreement released after a Cabinet meeting, the government said it would sell a majority stake in Aer Lingus but preserve a minimum 25 percent stake to permit the government to block any decisions by a majority owner.

According to reports, the state-run Dublin Airport Authority would oversee the building of a second terminal, while the actual running of the facility might be offered to a private company.

Transport Minister Martin Cullen said the government was not ready to specify details of the sale, such as whether it would be offered to corporate bidders or floated on the stock market. However, he did say that either course would be necessary for Aer Lingus to raise sufficient capital to compete with private international airlines. Cullen said the government’s plan to retain at least a quarter of company shares would represent "a blocking stake" that would safeguard Ireland’s national interests.

Opposition lawmakers blasted the decision as bad for travelers and tourism in Dublin, home to a third of Ireland’s four million people. They cited increasing overcrowding at the airport, where security checks can take hours to clear.