Aer Rianta board discusses break-up

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Legislation is published providing for the split of the Irish airports group

The Irish government has published legislation providing for the break-up of state airports group Aer Rianta. A bill entitled "To Provide For The Vesting, Management, Operation and Development of the State Airports" foresees the creation of two new companies to manage Cork and Shannon airports, with Aer Rianta being renamed the Dublin Airport Authority.

The moves, if passed through parliament, will take effect on or after April 30 2005. The board of Aer Rianta is to discuss the plans at a special meeting today. The break-up will only go ahead if the new boards in charge of the three airports can produce business plans to show that they are economically viable as independent companies.

The bill makes no mention of the future of Aer Rianta subsidiaries, including Aer Rianta International (ARI). Previous media speculation in Ireland has focused on the possibility of ARI coming under the control of the new board of Shannon airport.

The move has come in for opposition from unions and other parties in Ireland. The Labour Party spokesperson for transport Roisin Shortall said the break-up was badly thought out and called into question the future of ARI.

She said: ?There must be a question over the future of ARI, the highly successful overseas arm of Aer Rianta and the source of the bulk of the company's profits in recent years. One cannot underestimate the extent to which profits at ARI have underpinned the parent company and funded the development of its Irish airports. There is as a result of the government's decision to break up the company uncertainty over the future of ARI, which must introduce equal uncertainty about the viability of the Irish airports as separate companies with core problems unaddressed.?