May 30: Aer Lingus deal is good enough for Shannon

The long expected news that the state has agreed the sale of its 25.1% stake in Aer Lingus to IAG has been broadly welcomed in the Mid-West – if somewhat guardedly. This newspaper was unimpressed by the terms of the original offer made by IAG boss Willie Walsh, but we cannot join the ranks of those who continue to express outright opposition to the improved offer.

The long expected news that the state has agreed the sale of its 25.1% stake in Aer Lingus to IAG has been broadly welcomed in the Mid-West – if somewhat guardedly. This newspaper was unimpressed by the terms of the original offer made by IAG boss Willie Walsh, but we cannot join the ranks of those who continue to express outright opposition to the improved offer.

The deal is a long way from perfect but rejecting it now would be a hazardous business. In the Mid-West we sought better guarantees over Shannon’s Heathrow slots and a period of seven years has been agreed. Of course, 10 years would have made everyone feel better about the deal, but in life you sometimes have to make a judgment call that whatever is on the table is worth shaking hands over.

Limerick councillor Emmett O’Brien has said that he fears the Mid-West economy has been given “a sentence of death with a stay of execution of seven years”. That’s the kind of over-the-top language that a likely general election candidate looking to unseat a Government TD finds hard to resist, but in our view Cllr O’Brien does Shannon Airport a disservice. Senior management at the airport have welcomed the deal and their positivity must be taken at face value and welcomed.

Rose Hynes, the Shannon chairman, is nobody’s fool. Her robust language at a fundraising dinner for Mid-West tourism last week was refreshing. Her scathing dismissal of recent complaints by Fianna Fail leader Micheal Martin – who criticised Shannon’s business model, seemingly because it was taking business from Cork Airport – spoke volumes about how Shannon now sees itself. There is a confidence among the top team that simply was not there in years gone by and it’s that spirit of zeal that is winning new business. Ms Hynes made it clear, to the evident pleasure of her audience, that the airport will continue to go out and aggressively pursue market share, as any independent entity must.

Nobody knows what the next seven years hold for Ireland’s three main airports for the simple reason that in today’s business world seven months is quite a stretch. But to imply that Shannon will go belly-up as soon as the seven-year Heathrow guarantee expires in 2022 is something of an insult to the people who have been responsible for the reversal in its fortunes.

It will be quite some time before we see the real detail behind this deal, but it is clear that IAG sees much potential in Dublin Airport. We have heard rather too much of this in recent days and not enough about what IAG thinks of the expansion potential at Shannon. The scope for more traffic is huge and it will be up to the local management to fight that battle. All the indications are that they are more than up for it.