IAG confirms Aer Lingus offer price "will not be increased"

International Consolidated Airlines, the owner of British Airways and Iberia, has stated that its €2.55 per share takeover offer for Aer Lingus was "final and will not be increased" in light of concerns about Ryanair's stake in Ireland’s flag-carrier.

On Wednesday, IAG confirmed its firm intention to make an offer for Aer Lingus comprising a cash payment of €2.50 per share and a cash dividend of €0.05 per share, which values the Irish carrier at €1.4bn (£990m).

A regulatory news statement issued on Thursday stated that the group's position was final, certainly in response to concerns that budget airline Ryanair, which has a 29.8% stake in Aer Lingus, would force its larger rival into raising its offer.

Media coverage has dubbed Ryanair a “kingmaker” in IAG’s takeover bid for Aer Lingus after the Irish government earlier this week agreed to sell its own 25% stake in the airline.

IAG boss Willie Walsh said on Wednesday that he expected his Ryanair counterpart Michael O’Leary to “behave in a rational way”.

Two years ago the UK's Competition and Markets Authority called for Ryanair must sell down its stake in the airline to 5% and last month rejected Ryanair's attempts to block this decision.

However, O'Leary has said recently that if the watchdog does not reverse its ruling on the company's stake in Aer Lingus then he might sue for damages.

Speaking in an interview with the Sunday Telegraph earlier in May, O'Leary said: "If they don't reverse the decision we're going after them in court."