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|October 21st, 2006, 02:11 AM||#11|
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Ryanair says there will be significant jobs cuts at Aer Lingus
DUBLIN, Oct 20, 2006 (AFP) - Ryanair, Europe's largest no-frills carrier, will make significant job cuts at Ireland's former state airline Aer Lingus if its hostile bid is successful, Ryanair Chief Executive Michael O'Leary said Friday.
"If you look at Aer Lingus today they are carrying eight million passengers with 3,500 staff. We are carrying 42.5 million passengers with 3,500 staff.
"By any measure, Aer Lingus continues to be significantly over-manned," O'Leary told RTE state radio.
"There is no doubt in my mind that there will be significant job losses in Aer Lingus if the Ryanair bid is successful because that's one of the ways where we expect to reduce costs and to reduce fares."
He said pilots, cabin crew and engineers were not in danger of losing their jobs because if Ryanair's offer succeeds the plan is to "expand, enhance and upgrade" Aer Lingus operations.
Ryanair currently owns over 19 percent of Aer Lingus and plans to formalise its offer on Monday.
Ryanair launched its 2.80-euros-per-share bid on October 5, valuing Aer Lingus at 1.481 billion euros (1.883 billion dollars) just days after the company was partly privatized.
The bid was rejected by Aer Lingus management, and has also been greeted with hostility from the Irish government, which still holds a stake of over 28 percent, and trade unions.
The Ryanair board made a statement to the Irish Stock Exchange Friday outlining key elements of its offer.
It said that without the Ryanair takeover deal "Aer Lingus will continue to be a small regional European airline which, because of its size and regional nature, is unlikely to be of interest or relevance to the three major European airline groupings".
Isolated as a small regional airline, Ryanair claimed Aer Lingus would continue to be "at the mercy" of the government and trade unions.
It said that in recent years this had meant it lurched from crisis to crisis, incurred substantial cumulative losses, suffered repeated strikes, discouraged successful management and resulted in over 3,000 job losses.