Friday, August 22 12:13:57
Ryanair Chief Executive Michael O'Leary is today in Cyprus for talks with the government about the possible takeover of loss-making carrier Cyprus Airways, he told journalists.
Ryanair was among nearly 20 companies which last month submitted non-binding expressions of interest in the airline, now controlled by the Cypriot government. The process is a preliminary step towards any eventual binding offer.
O'Leary's announcement marked a change of approach as he had said last month that Ryanair, Europe's largest budget airline, was not particularly interested in acquiring the carrier.
"We are engaged in the process and hope something will come of it. It's a very political process down there," he told a new conference in Dublin on Thursday, adding that any deal would be small relative to Ryanair's overall growth strategy.
Under his company's proposal, Cypriot Airways would retain its brand and operate under a separate air operator's certificate to Ryanair, he said.
The Irish airline will propose it could boost the airline's passenger numbers to 3 million per year from 600,000 currently, down 50 percent from peak, O'Leary said. He declined to give any further details.
Ryanair has only ever taken over one other airline, Buzz, which was absorbed into the Ryanair brand.
Cyprus Airways has struggled to survive against cheaper competitors and has been loss-making for years despite several attempts at a turnaround.
The airline has recently resorted to selling assets to stay afloat, including its slots at London's Heathrow airport.
It is also under scrutiny by the European Commission. Brussels is investigating terms of a 31.3 million euro capital increase in early 2013, and a 73 million euro rescue package by the Cypriot state in 2012 to establish whether it violated state aid rules.
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