Aer Lingus again rejects call for egm

Aer Lingus has rejected Ryanair's second request for an extraordinary general meeting (egm) of shareholders to reverse the decision…

Aer Lingus has rejected Ryanair's second request for an extraordinary general meeting (egm) of shareholders to reverse the decision to end services from Shannon to Heathrow.

Aer Lingus said the second request for an egm was "no different in substance" from two earlier resolutions that were rejected on the basis that they would infringe Irish and EU competition law.

"The board of Aer Lingus will act in accordance with the law and will not dance to the tune of our competitor," Aer Lingus chairman John Sharman said.

Mr Sharman said Aer Lingus would "not be deflected by the self-serving agenda" of Ryanair. "The board's definitive decision is therefore to reject Ryanair's interference and turn down the request to convene an egm," Mr Sharman added.

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It is not clear what action Ryanair will now take in response. The airline said it had received the letter Aer Lingus and was "considering its contents".

Ryanair owns 29.44 per cent of Aer Lingus and is entitled to call the egm itself. It could also take legal action against Aer Lingus and its directors, alleging failure to meet their legal responsibilities by agreeing to its request for an extraordinary meeting of shareholders to be convened.

Investors with 10 per cent or more of Aer Lingus's shares are entitled to seek an egm.

It is understood that Aer Lingus would seek to block any attempt by Ryanair to call an egm itself of the former State-owned company.

At a press conference in Dublin earlier this month, Ryanair chief executive Michael O'Leary said that, if he did call the egm, the airline would charge the costs to Aer Lingus's directors.

He said he would hold an egm in the Four Seasons or Shelbourne hotels, with a free bar for investors.

Aer Lingus's shares closed down just more than 2 per cent in Dublin yesterday at €2.39.

Ciarán Hancock

Ciarán Hancock

Ciarán Hancock is Business Editor of The Irish Times