British Airways and Iberia parent company International Airlines Group has raised its bid to acquire Aer Lingus, the company announced on Tuesday.
IAG now is offering €2.55 per share for the Irish carrier—€1.34 billion total, an amount that Aer Lingus' board has indicated is "at a level at which it would be willing to recommend to Aer Lingus shareholders, subject to being satisfied with the manner in which IAG proposes to address the interest of relevant parties," according to IAG. The Irish flag carrier, which in December rejected an IAG takeover bid, is the third-largest airline at BA's home airport, Heathrow.
Among those "relevant parties" is the Irish government, which owns about a 25 percent stake in Aer Lingus, so an offer would require parliamentary approval. Low-cost carrier Ryanair owns an almost 30 percent stake. The deal also would require approval from EU Commission competition regulators.
Under IAG's proposal, Aer Lingus would continue to operate as its own business and brand while joining the Oneworld alliance and IAG's joint business with American Airlines, "leveraging the natural traffic flows between Ireland and the United States and the advantageous geographical position of Dublin for serving connecting flows," according to IAG.