Ireland's Aer Lingus has selected oneworld carriers American Airlines and British Airways as its preferred partners in a strategic alliance, ahead of a rival bid by Delta Air Lines.
The Irish Government must now approve the state-owned airline's choice of allies, with sources suggesting that full membership of the oneworld group is likely if the deal gets the go-ahead.
Dublin may also seek equity investment in Aer Lingus to allow for fleet renewal, and sources say American and BA are willing to take a 10% holding in the airline. A further stake might also be sold off through an initial public offering.
The Aer Lingus board approved a management recommendation in favour of American/BA on 29 April. Consultancy Salamon Smith Barney has been appointed to advise the Irish Government.
Sources describe Delta's alliance pitch as "attractive", but say a BA/American deal is a better fit with the Irish carrier's twin aims of developing vital transatlantic traffic and European routes. BA has had no direct services to Ireland for years, but recently developed links through its CityFlyer franchise.
Delta, Continental and Aer Lingus operate services between Ireland and the USA. Under the terms of the Irish-US bilateral, all the airlines are required to operate the same number of services from Shannon in the west of Ireland as they do from Dublin.
Source: Flight International
