The Government stands to raise more than €230 million cash from the sale of shares in Aer Lingus and will retain a 25 per cent stake worth over €280 million, advisers to the sale believe. Emmet Oliver & John McManus report.
The sales prospectus for the company, which will be circulated today, claims a current value on the airline of €600-€770 million. The range is based on the value of British Airways, which has a similar business mix to Aer Lingus.
Advisers to the company and the Government estimate this will rise to between €1.1 billion and €1.3 billion once new shares have been issued and the company floats on the Dublin and London stock exchanges in early October. The advisers have recommended that the airline issue new shares worth over €530 million to incoming investors, while the Government will also sell most of the shares it holds in the company to new investors for upwards of €230 million.
The Government stake is expected to fall to 25 per cent from its current 85 per cent as a result. It is committed to keeping a 25 per cent stake, which it says is needed to protect key strategic assets such as the landing slots at Heathrow Airport in London.
An investment briefing begins in London today with potential institutional investors getting 45-minute presentations from a management team led by chief executive Dermot Mannion. Other cities to be visited over the next two weeks include New York, Boston, Dublin, Frankfurt and Paris. The final size of the flotation and the share price will be set after the briefings are completed. The company's first half results will be released today.