Aer Rianta breakup: ARI could come under Shannon control

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Irish minister gives first indication of ARI's future under breakup proposals

In the clearest indication yet of the future structure of the Aer Rianta group, Irish Transport Minister Seamus Brennan said on Friday that the overseas arm, Aer Rianta International (ARI), could come under the control of the new board at Shannon airport.

Under government proposals, Aer Rianta will be broken up into separate operating companies for Dublin, Cork and Shannon airports in a bid to make each location more competitive. Until now, the government has made no comment on the future of ARI.

But the minister has come under increasing pressure about his plans for the breakup, particularly as a report by advisors Price Waterhouse Coopers claimed that Shannon airport would not be profitable for many years, even if its debt was to be removed. Under the plans, Dublin airport would assume all the group's debt, which is forecast to hit ?400m ($465m) by 2006 amid a series of big infrastructure projects. The report also said that 75% of Dublin airport's profits would be wiped out if it had to pay interest on the debt.

Speaking on Irish television, Brennan insisted that Shannon could show a profit if the international business was to come under the control of the new board there. ARI's headquarters is at Shannon airport, but the overseas division operates as a stand-alone entity with its own board of directors. The Irish airports' retail operations also rely heavily on ARI's buying power, and it remains unclear how this will be affected by the breakup.