The International Airlines Group's (IAG) bid to acquire Aer Lingus (EI, Dublin International) looks set to drag on after Ryanair (FR, Dublin International) said it would appeal the UK Competition and Markets Authority's (CMA) final order requiring the LCC to reduce its 29.8% stake in Aer Lingus Group to below 5%.

In a statement issued on Thursday last week, the CMA said it was upholding its original 2013 decision which found that Ryanair's continued presence as an Aer Lingus shareholder would deter other airlines from merging with or bidding for Aer Lingus.

"It is clear that the timing of IAG’s bid has been influenced by the prospect of Ryanair being forced to sell the majority of its shareholding," Simon Polito, Chairman of the Ryanair/Aer Lingus inquiry group, said. "IAG has said that it would not be interested in acquiring any airline with a significant minority investor. The conditional nature of IAG’s bid is consistent with this and our original assessment that Ryanair’s presence was likely to deter other airlines from entering into, pursuing or concluding combinations with Aer Lingus."

However, in its typical brash manner, Ryanair has dismissed this view of events with Michael O'Leary labelling the CMA's decision "ridiculous". The carrier has said it will appeal the ruling to both the Competition Appeal Tribunal (CAT) and the UK Supreme Court.

“Both Simon Polito and the CMA are attempting to defend the indefensible. The sole basis for their 2013 divestment decision was (redacted evidence) that Ryanair’s minority stake was or would prevent any other airline making a bid for / or acquiring control of Aer Lingus," O'Leary said. "This bid process – which the CMA contended “could not take place” – is now in fact taking place, but Mr Polito and the CMA have again moved the goal posts to argue that Ryanair can somehow block an IAG bid for Aer Lingus from succeeding when it is patently clear that as a 29% shareholder, Ryanair cannot prevent IAG acquiring control of Aer Lingus."

The LCC claims that the IAG's decision to proceed with its plans to acquire Aer Lingus despite Ryanair's minority shareholding was proof the CMA's findings were "manifestly wrong."

Ryanair argues that it, as a minority shareholder, will not be able to block the IAG's takeover bid should more than 50% of other shareholders accept it. Thus far, the Irish government and Etihad Airways (EY, Abu Dhabi International) have agreed to dispose of their respective 25.11% and 4.99% stakes in Aer Lingus.

While the IAG has yet to submit a proposal to Ryanair for its shareholding, which would be valued at just over EUR400 million at the IAG's offer of EUR2.55 per Aer Lingus share, O'Leary has said that even with one, his airline will continue to appeal the CMA's divestment decision on the grounds that it sets a dangerous precedent for future Ryanair acquisitions.

“Even if we accept the IAG offer, we will continue to appeal this divestment decision until it is exposed and overturned,” he told the Financial Times. “We will not allow the CMA to keep this precedent. We may at some stage want to acquire someone and we will not have the CMA inventing bogus theories of harm.”

Other reports in the British media have claimed O'Leary may be willing to sell off Ryanair's stake in return for more concessions from the IAG, including a number of its slots at London Heathrow.

Earlier this year, O’Leary said his airline would be willing to acquire any London Heathrow slots the IAG would likely have to relinquish in return for European Commission (EC) competition approval of its take over of Aer Lingus. As such, O'Leary has said that Ryanair's decision on the IAG's bid will only be made after the EC has issued its own ruling, a process that could take months.