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Aer Lingus profits fall as IAG closes in on takeover

Aer Lingus aircraft

Aer Lingus has reported a 23.4 per cent fall in profits as British Airways’ owner IAG is poised to complete its takeover of the Irish airline.

The Dublin-based carrier recorded a pre-tax profit of €27.8 million for the three months to June 30 – this was down from a profit of €36.3 million during the same quarter in 2014. This fall in profit was despite a 7.1 per cent increase in Aer Lingus’ total revenue to €469 million year-on-year.

Aer Lingus is set to join IAG in a €1.4 billion takeover after the deal was approved by the European Union earlier this month and Ryanair agreed to sell its shareholding in Aer Lingus to IAG.

IAG’s offer for Aer Lingus of €2.55 per share is set to close at 13.00 on Thursday (July 30) and IAG has said that it needs 90 per cent of shareholders to accept the offer to close the acquisition.

Aer Lingus CEO Stephen Kavanagh said: “I would like to reiterate the view of the independent directors of Aer Lingus that the combination with IAG will strengthen Aer Lingus and will grow our airline and contribute to growth in the tourism sector and wider Irish economy.”

IAG has agreed to a series of assurances on Aer Lingus’ slots from Heathrow and the Irish government will also own a “golden share” in the Irish carrier, which allows Ireland’s finance minister the power to block any changes to the routes operated using Aer Lingus’ Heathrow slots.

Aer Lingus has launched a new route from Dublin to Washington and introduced a new business class cabin in the last few months as part of its long-haul expansion strategy.

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