The European Commission announced on 29th August it would immediately begin a in-depth phase II investigation into the proposed acquisition of Aer Lingus by Ryanair, which was notified to the EC on 24 July 2012.

In an statement the EC Commission stated  “Ryanair and Aer Lingus are the main operators out of Dublin airport. On a large number of European routes, mainly out of Ireland, the two airlines are each other’s closest competitors and barriers to entry appear to be high.”

“Many of these routes are currently only served by the two airlines. The takeover could therefore lead to the elimination of actual and potential competition on a large number of these routes.”

A spokesman for Aer Lingus said: “The number of routes into and out of Ireland on which Aer Lingus and Ryanair compete has sharply increased since 2007. The reasons for prohibition are therefore even stronger than before.”

Ryanair said in a statement “Ryanair’s offer lapses, in accordance with takeover rules, with immediate effect, and all acceptances of the offer to date are void. Ryanair intends to re-bid for Aer Lingus if the European Commission clears its offer following its Phase II review”.

The European Commission has 90 working days, until 16 January 2013, to take a decision on whether the proposed transaction would significantly impede effective competition in the European Economic Area (EEA).

Irish Aviation Research Institute © 31st August 2012 All Rights Reserved.