Turkish Airlines eyes Ireland's Aer Lingus: report

A Turkish Airlines plane arrives at Ataturk International Airport in Istanbul May 29, 2012.

DUBLIN (Reuters) - Turkish national carrier Turkish Airlines (THYAO.IS) may be a potential bidder for Aer Lingus (AERL.I), just days after rival Irish airline Ryanair (RYA.I) made a surprise buyout bid, according to a report in the Sunday Business Post.

Turkish Airlines is assessing Ireland's 75-year-old former flag carrier and is "very interested" according to sources.

It is one of several international airlines looking at Aer Lingus, according to the report. Abu Dhabi's Etihad, which already owns a 3 percent stake, has long been cited in the media as a possible bidder for the government's 25 percent stake.

Turkish Airlines, which could only hold a 49 percent stake in Aer Lingus because it is based outside the European Union, could buy the government's stake or form a partnership with another airline, said the sources.

Both Turkish Airlines and Etihad view Dublin as a potential hub through which passengers could be routed to the Far East and beyond, according to the report.

Aer Lingus declined to comment on the report. A spokesman at Turkish Airlines was not immediately available for comment.

Ryanair, which is the largest shareholder in Aer Lingus, launched its third bid to take over its rival on Tuesday, saying it would offer 1.30 euros per share to secure at least 50 percent of the carrier.

The bid, which values Aer Lingus at 694 million euros ($880 million), would be subject to the approval of the European Commission, which in 2007 blocked an earlier bid by Ryanair for Aer Lingus on competition grounds.

The surprise move by Ryanair's flamboyant chief Michael O'Leary this week also led to speculation that it was a plot to flush out prospective buyers for Ryanair's own 29 percent stake in Aer Lingus.

Turkish Airlines recently pulled out of talks with Poland's LOT LOT.UL to form a possible tie-up.

(Reporting by Lorraine Turner; Additional reporting by Ayla Jean Yackley; Editing by Catherine Evans)