Mr. Willie Walsh:

I thank the Chairman for extending the invitation to us to attend the meeting. The principal reason I am here is to give the joint committee an opportunity to ask me questions. I introduce Mr. Finbarr Griffin who is required to be with me under takeover panel rules. He is my chaperone, but I also acknowledge the fact that the takeover panel has extended some latitude to us to appear before the committee. I hope to be in a position to answer most, if not all, of the committee’s questions. There are some areas where I will be restricted in what I can say.

By way of introduction, I will say a little about International Airlines Group, IAG. It was created in 2011 as a result of the merger of British Airways and Iberia. It is one of the largest airline groups in the world. In terms of market capitalisation, it is the number one airline in Europe. Our market cap exceeds the combined market caps of Air France, KLM, Air Berlin, Aer Lingus, Lufthansa, SAS, Turkish Airlines and Finnair. If one adds their market caps together, they come to the same as ours. We are a significant player in the airline industry; we are approximately number four or five in the world.

Ours is a multinational, multi-brand airline group. Our goal is to facilitate consolidation where we can identify strong airlines with strong brands and allow them to operate under the umbrella structure of IAG, benefiting from the scale we can provide. While we have three principal airline brands, we actually have six airlines: two in the United Kingdom - British Airways and British Airways City Flyer; Iberia, Iberia Express, Vueling based in Spain and OpenSkies based in Paris. We also have a cargo business, one of the top ten in the world, with an annual turnover of approximately €1 billion. We serve 250 global destinations. We have a frequent flyer loyalty programme, which is the number one airline loyalty programme in Europe and one of the biggest in the world, with 6.3 million active customers. IAG airlines flew 77.3 million passengers in 2014, serving 250 destinations. We have over 460 aircraft and a turnover of approximately €20 billion.

We are interested in acquiring Aer Lingus because we believe it will fit very well with IAG. It has a very strong brand, particularly in Ireland; on the east coast of the United States of America where it punches way above its weight; and in the United Kingdom. We admire what the Aer Lingus management team has done in recent years, particularly in the restructuring of the airline and the exploitation of Dublin as an international hub serving transatlantic routes. Aer Lingus is an efficient airline operating in a competitive market. It is well run and we believe it represents a growth opportunity for IAG. We are interested in acquiring it because we believe we can facilitate, accelerate and expand its growth plans.

I am sure it has been noted before that I am a former employee of Aer Lingus, of which I am a deferred pensioner and shareholder, holding 10,616 shares. It is also known that I am Chairman of the National Treasury Management Agency, NTMA, and, as such, declared a material interest to the NTMA board. That has been disclosed. I have, however, no access to any information in the NTMA, any discussion or participation in any debate within the NTMA on Aer Lingus.

I recognise that there have been many questions and a great deal of concern expressed by members of the committee and others about our proposed acquisition of Aer Lingus. Our intentions are completely positive. We believe we can bring to Aer Lingus strength and support that it cannot have as a stand-alone airline. We believe we can facilitate the expansion of the network, benefiting Aer Lingus, the airports it serves in Ireland and the Irish economy. We are committed to maintaining the Aer Lingus brand and have given guarantees to do so. We are committed to maintaining the Aer Lingus head office in Dublin. We are committed to maintaining ownership of the Aer Lingus Heathrow Airport slots within Aer Lingus. We are prepared to give a cast iron, solid, legally binding guarantee to ensure the ownership of these slots rests with Aer Lingus and to extend to the Irish Government not just the ability to express, with the support of other shareholders, a block in terms of the disposal of these shares but also to strengthen that position and in a fully legally binding way. We have also given an assurance, a guarantee that we will continue to utilise the Aer Lingus slots to serve the Ireland-Heathrow market. That is a guarantee that does not apply today and it goes beyond what is in place today. We believe we are uniquely positioned to give these guarantees. I do not believe there is any other party that might be interested in acquiring Aer Lingus, if there are other parties, that would be prepared to give the guarantees we are prepared to give. We are prepared to give these guarantees in a way that will not be challenged. In other words, they will be legally binding. I have heard people say they are not worth the paper on which they are written. I can assure the committee that we have smart lawyers who have been able to identify a structure that will secure them in a legally binding way.

We believe Aer Lingus has good opportunities ahead and that we can support these opportunities. We want to bring it into IAG in the same way as our other airline brands, where it will have an independent brand that can be invested in and control over its own operations run by an Aer Lingus management team but fully participate in the advantages it will have in being part of a larger group. We believe this is an exciting opportunity for Aer Lingus. It represents excellent value for current Aer Lingus shareholders and all of the stakeholders involved in Aer Lingus.