Y’know, way back in April I argued that privatising Aer Lingus was an absurd idea. It would essentially be trading an important public asset for a small increase in wealth for the already wealthy. Aer Lingus was a successful public service, doing roughly what the people of Ireland needed of it. It was under our control and had a legal obligation to serve our needs. How could we possibly expect to improve on that by putting it under someone else’s control and giving it a legal obligation to serve their needs?
It makes no sense to me. I guess most people believe that the needs of wealthy investors will tend to coincide with the needs of the average member of the Irish population. That’s not an article of faith I share.
Of course, there was one way the Irish government and their policy of selling off the family silver could screw over the Irish people even more than floating Aer Lingus… they could flog it to Ryanair for a bargain-basement price. You gotta love Bertie; he’s found a way to do both.
Yes folks; it seems that Michael O’Leary, CEO of Ryanair, has authorised the purchase of 16% of Aer Lingus and put in a bid for controlling interest. He’s paying 27% above the floatation price. So the people with the money to invest in Aer Lingus have made 27% on their money in a little over one week. And unless Aer Lingus has done something remarkable during that week to make their value soar, it poses the question of why the Irish people had their goods sold off at a price substantially lower than someone is obviously willing to pay.
Did the investors need that 27% more than the Irish people needed Aer Lingus? Let’s hope so. Because it’s gone for good. And people fond of flying Ryanair will be happy to hear that it comes in two colours now.