Budget airline Ryanair said it planned to make a €694-million ($880-million U.S.) cash bid for Aer Lingus in a fresh attempt to gain control of its Irish rival.
Ryanair said on Tuesday after the market close that it would offer €1.30 per share for Aer Lingus, in which it already owns a 29.8 per cent stake.
The main obstacle to a takeover would be the European Commission, which investigated an earlier bid and decided to prohibit it in June 2007.
Britain's competition authorities could also cause problems. The Office of Fair Trading last week ruled that Ryanair's ownership of the minority stake threatened competition in the U.K.
But Ryanair said on Tuesday that it believed circumstances had changed materially since 2006, citing consolidation within the industry, more capacity at Dublin airport and the increased likelihood that the Irish government would sell its own 25 per cent stake in the Irish flag carrier.
The government has committed to selling its stake as part of its EU/IMF bailout programme, but has made clear that it would not sell to Ryanair due to competition concerns.
"Ryanair believes that any competition concerns which the European Commission may have can be addressed by Ryanair making appropriate remedies prior to the completion of this offer and by significant synergies and cost efficiencies resulting from this combination," the company said in a statement.
Investors were sceptical, though.
"It is very hard to see how it would be accepted by European competition authorities," said Brian Devine, an analyst with NCB Stockbrokers.
Aer Lingus declined to comment and officials at the Irish government did not immediately respond to requests for comment.