UPDATE 1-Aer Lingus board backs 140 mln euro pension payout
* Aer Lingus says compromise challenging for all parties
* To be put to owners after talks with unions and trustees
* Minority shareholder Ryanair to oppose "daylight robbery"
* Aer Lingus shares up 2.8 percent
DUBLIN, May 31 (Reuters) - Aer Lingus's board backed a proposed 140 million euros ($183 million) one-off payment to employee pensions on Friday under a deal to avoid possible strikes at the Irish airline.
The deal aims to address a hole in a pension scheme which employees at Aer Lingus share with other aviation industry workers and which had a deficit of over 700 million euros at the end of 2011.
"The recommendation is clearly a compromise that contains elements that are challenging for all parties," Aer Lingus Chairman Colm Barrington said in a statement.
The proposal will be put to Aer Lingus shareholders following talks with unions and pension fund trustees, and will be implemented if staff and union members also agree, Aer Lingus said.
Low-cost airline Ryanair, which owns 30 percent of Aer Lingus and this year failed in a third takeover attempt, opposed the pension pay-out, as expected, but acknowledged it did not have enough votes to block it alone.
"How many times are the board of Aer Lingus going to roll over when their staff and unions threaten industrial action unless they get paid off again and again," Ryanair Chief Executive Michael O'Leary said in a statement.
"We believe this is blatant mismanagement by a board which is controlled by, and panders to, government and unions and does nothing to protect shareholder funds ... Ryanair will oppose this latest 'daylight robbery'."
Britain's Competition Commission is to rule by July on whether to force Ryanair to sell its stake in Aer Lingus due to competition concerns.
Aer Lingus shares, which have been weighed down in recent years by the threat of a large pension payout, were trading 2.8 percent higher at 1.59 euros by 1110 GMT.