In a packed ballroom at Dublin’s Gresham Hotel in November 2006 – just weeks after its September debut on the stock market – then Aer Lingus chief executive Dermot Mannion urged shareholders to reject what he said was a “derisory” €2.80 a share takeover offer from Ryanair.
But Mr Mannion quickly earned a rebuke from the Takeover Panel. Asked by this reporter if, given the offer was derisory, what an acceptable offer might be, Mr Mannion insisted Aer Lingus was not for sale at any price.
It had to be for sale – any listed company is, every day. It turned out it was. Just not to Ryanair, which tried two more times to snap up its smaller rival.
Tomorrow, Aer Lingus shares – floated to much fanfare by the then Fianna Fáil government – will be delisted from the stock exchanges in Dublin and London as IAG puts the finishing touches to its acquisition of the airline.
Shareholders who stuck by the airline through the years might have been better off stuffing their money in the Post Office – almost.
With IAG paying €2.50 a share (plus a five cent dividend that was actually paid out by Aer Lingus a few months ago), investors who bought at €2.20 a share nine years ago are getting a 13.6pc return on their investment.
That excludes token dividends paid by the airline since 2012. It paid three cents a share that year. In both 2013 and 2014, it paid a four cent dividend, and this year, five cent. In total, that amounts to just 16 cents per share over three years. Barely a hill of beans.
For some investors, the takeover made for a big payday though. Abu Dhabi-based airline Etihad, which owned close to 5pc of Aer Lingus, saw the value of its stake in the airline more than double to just over €65m.
Even Ryanair, which owned 29.8pc of Aer Lingus, managed to eke out a pyrrhic profit from the €407m it spent buying that stake. The Aer Lingus dividends helped to tip the investment into the black, but only just. Ryanair’s annual general meeting is next week, with shareholders anticipating that the airline will use those Aer Lingus proceeds to fund either a share buyback or a special dividend.
The Government has received €335m for the State’s 25.1pc stake in Aer Lingus. That income will be used to establish a ‘Connectivity Fund’ to back infrastructure projects around the country.
But tomorrow morning brings to an end the final chapter of Aer Lingus’ more than seventy-year history as an “Irish” company.
It still is Irish, of course, in many ways: it will be managed from its existing headquarters in Dublin; its chief executive, Stephen Kavanagh, remains in situ; and the aircraft livery won’t suddenly be changed.
But IAG, headed by Willie Walsh and which also owns British Airways, Iberia and Vueling, will call the real shots.
The great hope is that IAG achieves its aims, significantly growing Aer Lingus over time and cementing Dublin’s position as a major secondary international hub.
And if you ever really felt nostalgic about Aer Lingus, just remember this: As a State-owned airline, with a virtual monopoly on air traffic to the United States, the UK and Europe in its heyday, the airline’s legendary largesse was paid for decades by sky-high fares it squeezed from taxpayers.
Luckily, all that has changed. And hopefully the IAG takeover will bring a new era of growth for Aer Lingus. Let’s see what’s it’s like nine years from now.