CHRISTOPH MUELLER took on the role of chief executive of Aer Lingus at the beginning of the month with a mandate to “transform Aer Lingus from a legacy Irish business to a modern international airline”. The Irish Times reported on 10th September that Mueller is to be paid a basic salary of €475,000 – in line with the pay of his predecessor, Dermot Mannion and that he will not be paid a bonus. His remuneration package is said to be in line with that offered by similarly-sized Irish listed companies”
Success for Mueller is the recovery of the 2006 IPO share price within five years.
‘Trust but Verify’
I always find it instructive to adopt the Ronald Reagan adage ‘trust but verify’ when considering statements by Aer Lingus. Reagan used the adage as US-Soviet relations were thawing in the 1980’s.
All has to be considered in the context of the real beneficiaries of the 2006 IPO. They are the former chief executive, Dermot Mannion; the non-executive directors whose fees trebled and the professional advisors who obtained €30 million in fee income in respect of the IPO and €24 million in respect of the Aer Lingus response to the two Ryanair bids. There have been no dividends. The share price has collapsed. The pilots’ pension fund has been severely depleted through its Aer Lingus investment.
‘Basic Salary – No Bonus’
Mannion joined Aer Lingus in August 2006. He departed in April 2009. Cumulative losses at the airline during his tenure were €72.4 million. Cumulative losses since 2006 increased to €165.4 by the end of June 2009.
Mannion’s pay record has been: