UPDATE 2-Ryanair ups pressure on Aer Lingus over pensions
* Shareholder Ryanair says Aer Lingus mishandling pension issue
* Pension deficit key to sale of govt's 25 percent, Ryanair's 30 pct
* Ryanair wants no payments to scheme without shareholder approval (Adds no comment from Aer Lingus)
By Conor Humphries
DUBLIN, Sept 16 (Reuters) - Europe's largest budget airline Ryanair criticised on Friday the management of rival Aer Lingus , in which it holds a 30 percent stake, over its handling of a huge pension deficit widely seen as an impediment to attracting a strategic investor.
Dublin-based Ryanair called on Aer Lingus, which has said it fears industrial unrest over the pension deficit, to refrain from making payments to the pension scheme without shareholder approval.
A spokesman for Aer Lingus declined to comment on Ryanair's statement
Aer Lingus in August said it had no obligation to fund a shortfall of approximately 400 million euros ($554 million) in an employee pension scheme, but warned that this position could be open to a legal challenge.
The deficit is larger than the company's market capitalisation of 353 million euros.
The Irish government is considering the sale of its 25 percent stake in Aer Lingus but uncertainty over the pension deficit is seen as a hurdle.
Ryanair has twice had takeover bids for Aer Lingus rebuffed amid competition concerns and has said it may sell its stake in the former state carrier to an investor who buys the government shareholding.
Analysts say the question mark over the pension scheme has significantly depressed Aer Lingus' share price, which has fallen by 43 percent since the start of the year.
Ryanair in a statement criticised past payments to the pension scheme, an employee shareholder scheme and to the government over unpaid taxes from an employee redundancy package.
Ryanair's outspoken chief executive Michael O'Leary has been a long-standing critic of Aer Lingus.
"Ryanair believes that other Aer Lingus shareholders will share its shock and dismay at recent payments by the Board of Aer Lingus without any approval from shareholders," Ryanair said in a statement.
"The Board and Management of Aer Lingus should now end this pension uncertainty by confirming that they will not make any further payments to these defined contribution pension schemes over and above current (direct contribution) rates without the prior approval of shareholders," it said. ($1 = 0.722 Euros) (Editing by Hans-Juergen Peters)
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