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Former Aer Lingus chief executive Cristoph Mueller Mark Stedman/Photocall Ireland

Aer Lingus bosses will share in millions if a sale goes ahead

There’s some big money riding on the IAG buyout offer.

CURRENT AND FORMER bosses at Aer Lingus could share in a payday worth nearly €6.3 million if the airline’s proposed sale to suitor IAG goes ahead.

And easily the biggest share of that windfall would go to the airline’s former chief executive, Christoph Mueller, who stood down from his post at the end of February to take over the troubled Malaysia Airlines.

In January Aer Lingus confirmed it was weighing an all-cash offer from British Airways parent company IAG to buy the airline for €2.55 a share after previously knocking back several approaches at lower prices.

Since then, the Irish airline’s chairman, Colm Barrington, has said it was the “strong view” of the board that being part of the major airline group would have “a compelling commercial logic” for Aer Lingus and would also be positive for Ireland.

But the deal has run into political roadblocks over handing over the government’s 25% stake due to fears the merger would result in jobs cuts and a loss of connections – particularly to London’s pivotal Heathrow airport.

Ireland Aer Lingus AP Photo / Shawn Pogatchnik AP Photo / Shawn Pogatchnik / Shawn Pogatchnik

A big payday

However if the sale did go ahead at the proposed price, which values the airline at about €1.35 billion, former boss Mueller could walk away with over €4 million alone. His plan to step down was first announced in July last year.

The latest Aer Lingus annual report showed that, as of the end of last year, Mueller held easily the largest number of shares among the company’s directors. His 709,555 existing shares would be worth €1.8 million if the offer from IAG went ahead.

But his real pay day would come from cashing in one million share “options” he had outstanding in the company for meeting September 2012 and 2013 targets for the airline’s market price.

Aer Lingus operating loss Former Aer Lingus chief executive Christoph Mueller Niall Carson / PA Wire Niall Carson / PA Wire / PA Wire

The options give him the right to buy the shares at a massive discount and, if exercised, would boost his total shareholding to a value of €4.36 million on the IAG offer.

Mueller’s average purchase price on the shares would be only about 25% of the proposed buyout price – returning him a profit of about €1.925 million on the options.

That would be on top of the €1.24 million he received in salary and benefits last year – down on the €1.52 million he received in 2013 – the biggest piece of which came from a €523,000 performance-related bonus.

Aer Lingus Business AGMS Aer Lingus chairman Colm Barrington with Mueller in 2013 Mark Stedman / Photocall Ireland Mark Stedman / Photocall Ireland / Photocall Ireland

Who else?

The next-largest tranche of shares was in the hands of Barrington, who held 300,000 shares worth €765,000 at the purchase price.

Meanwhile new chief executive Stephen Kavanagh, who first joined the company in 1988, also owned a significant piece of the airline – 282,748 shares worth about €721,000 at the offer price – as of the end of December.

Aer Lingus_2011 Stephen Kavanagh, right, with Mueller in 2011 Mark Stedman / Photocall Ireland Mark Stedman / Photocall Ireland / Photocall Ireland

Chief operating officer Fergus Wilson, who has been in the post since 2011, held 120,410 shares worth €307,000.

Board member William Slattery, who is also the executive vice president of US financial firm State Street, had 26,295 shares worth €67,000.

Nicola Shaw, the chief executive of UK railway High Speed 1 and another board member, owned 23,945 shares worth €61,000.

Money Animated GIF Giphy Giphy

First published 11.41am

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56 Comments
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    Mute DaMoons
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    Nov 30th 2019, 7:07 PM

    Again, the media pedal the Government story on average income being 51k. The most accurate statistic includes in the same report showed the median income (which represents 90 percent of the population) being less than 24k per year. A hell of a distance from the 51k figure the Journal and government are spinning.

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    Mute Brian Ó Dálaigh
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    Nov 30th 2019, 7:47 PM

    @DaMoons: while I agree there is a discrepancy, the figure quoted above is household income compared with your figure of individual income. Household income often combines 2 or more individual incomes as it is calculated based on total income divided by number of households, and not individuals.

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    Mute DaMoons
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    Nov 30th 2019, 8:15 PM

    @Brian Ó Dálaigh: Well, 2 incomes from the 90 percent quoted above still wouldn’t reach 51k. So it obviously points to 3rd and 4th earners living in the same household. Would it be a stretch for me to suggest that it is probably down to adult children not being able to afford somewhere to rent? FG were so proud of this statistic this week. Think about it.

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    Mute Brian Ó Dálaigh
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    Nov 30th 2019, 9:00 PM

    @DaMoons: I’d say you’d be pretty bang on the money (no pun intended) with that comment. The slightest bit of analysis into the figures and you’d wonder why Fine Gael would be proud of it. And, remember, these are average figures and not median figures which would far more accurately reflect the reality for the vast majority of people.

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    Mute Manbackonboard
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    Nov 30th 2019, 7:03 PM

    Constantly broke.

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    Mute StillNotNews
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    Nov 30th 2019, 8:00 PM

    @Manbackonboard: Same, Keep the recovery going, For TDs.

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    Mute SC
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    Nov 30th 2019, 7:06 PM

    With an average rent of 24k and childcare for one child 12k, that is just about enough for a small family. It’s not enough for two children.

    And assuming that’s the median, half of households have less. Is it any surprise we have a birth rate below replacement now?

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    Mute Finbarr Barry
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    Nov 30th 2019, 7:20 PM

    @SC: and they are quoting disposable income… I. E income after all expenses such as mortgage/rent, utilities et. Etc are paid…. What a load of BS

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    Mute Finbarr Barry
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    Nov 30th 2019, 7:23 PM

    @Finbarr Barry: https://www.breakingnews.ie/ireland/cso-figures-show-mean-disposable-income-is-now-almost-23000-967144.html

    CSO figures show average disposable income in 2018 was €23,000; 9.6% up on 2017

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    Mute Sos
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    Nov 30th 2019, 7:32 PM

    @Finbarr Barry: disposable income is income after government tax has been paid. Discretionary income is income after bills have been paid. Given the very high cost of living here I would expect that to be a lot less.

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    Mute Peter Hughes
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    Nov 30th 2019, 7:42 PM

    @SC: I’m delighted, we deserve it we keep voting for it……keep the rippoffs going lads there are legions of suckers who are stuffing your pockets full of cash and keep voting for you……dumb is an understatement.

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    Mute SC
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    Dec 1st 2019, 10:24 AM

    @Peter Hughes: the government has no power to interfere with the economy because it goes against EU rules in most situations (we can’t borrow to boost housing stock, we can’t subsidise rural industry to take pressure off the cities and keep our language alive etc) so it doesn’t make a difference who you vote for.

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    Mute keano
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    Dec 1st 2019, 10:37 AM

    @Finbarr Barry: no Finbarr I believe disposable incoming is your Income after Tax. Before Rent, mortgage, heat, light, etc etc. which would make it a lot more realistic figure and nothing to be proud of !

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    Mute Anastasia
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    Nov 30th 2019, 8:06 PM

    Spin spin spin the average wage is 20000 euro for a 38 hour week or am I working in the wrong place

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    Mute DaMoons
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    Nov 30th 2019, 8:36 PM

    @Anastasia: 90 percent of the people working in Ireland earn less than 24,000. This figure from the Government is pure spin.

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    Mute Brian Clancy
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    Nov 30th 2019, 9:06 PM

    @DaMoons: that’s rubbish anyway for a start

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    Mute John fitzpatrick
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    Dec 2nd 2019, 8:57 AM

    @DaMoons: so you are saying 90% are on minimum wage? Or are you saying that a huge portion of people are part time. What are you saying. What ever your saying it’s BS. But go , keep on plugging the SF agenda, 13% of the people believe you.

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    Mute Harry Trafford
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    Nov 30th 2019, 10:36 PM

    I work 50+hours a week. I’ve a wife and 2 kids. Council house and a car loan, I’m sure like alot of other houses. All I see is the weekly shop getting more expensive, insurance through the roof, more taxes. I’m not seeing any recovery around here. I’d dream of have 51k disposable income. I call bs on the whole thing. This ff fg government are a joke and need to be shown that we are done being fed lie after lie and tax after tax.

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    Mute Ro-your-nan
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    Nov 30th 2019, 7:43 PM

    All the poor-mouths on here – every pub in the country always seem rammed with people swallowing their disposable incomes down their fat necks. Drink less Irish-alcos and you might feel a little better off. Now I’m off to the pub

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    Mute SC
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    Dec 1st 2019, 10:26 AM

    @Ro-your-nan: I don’t think spending a few hundred a year on drink and a few hundred on electronics explains why people can’t afford ten thousand for childcare or 24k for rent… And my car insurance has nearly doubled even though I’ve never even had a penalty point so we’ll all be paying another grand for that soon enough.

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    Mute Ro-your-nan
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    Dec 1st 2019, 1:11 PM

    @SC: move out to Wicklow and don’t have a kid and you’ll be grand. Reckon people are dropping easily €10k a year (€200 per week) on booze. Look at all the snowflakes eating / drinking in town but they can’t save for a deposit.

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    Mute CJ Stewart
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    Dec 1st 2019, 10:28 AM

    ..well somebody must have disposed of my 51k without me seeing it !

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    Mute Michelle Keeley
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    Dec 1st 2019, 8:20 AM

    https://www.thejournal.ie/rish-workers-earn-an-average-of-e23-an-hour-4677090-Jun2019/

    According to the CSO, the average full time wage is approx €48000 and average partime €17000.

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    Mute Luap
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    Dec 1st 2019, 9:41 AM

    51k DISPOSABLE income? Hahahaha

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