Ryanair Holdings Plc buckled under pressure from disgruntled pilots and agreed to recognize labor unions in an eleventh-hour move by Europe’s biggest budget airline to avert its first-ever strike. The Irish company said Friday it has written to pilot organizations in Ireland, the U.K., Germany, Italy, Spain and Portugal, inviting each of them to talks. The carrier will “recognize these unions as the representative body for pilots in Ryanair in each of these countries.” The shares fell the most in five months. The about-turn by Chief Executive Officer Michael O’Leary, who once said “Hell would freeze over” before Ryanair unionized, reflects the intensity of the pressure pilot groups have put on the airline for recognition or face labor action during the busy holiday season. The CEO had pledged higher pay and bonuses to keep flight-deck crews from bolting to rivals and also threatened them with retaliatory measures if they went on strike. “If we need to change, we do it,” Edward Wilson, chief people officer at Ryanair, said in an interview. “If unionization is what we need to do not to have disruptions for our customers then we’re going to do it.” Italian Walkout Italy’s main pilots’ union, Anpac, canceled its participation in a planned four-hour walkout scheduled to begin at 1 p.m. Friday. Another Italian union, Fit-Cisl, which represents some pilots, flight attendants and ground staff, said earlier it would go ahead with the strike. The action would have been the carrier’s first-ever and the opening volley in a series of disruptions by labor groups in other European countries. “Ryanair is a company sustained by all of its workers, pilots, flight attendants and engineers, so it can’t just dialogue with some of them,” Antonio Piras, a Fit-Cisl official, said in a statement. Members of the Irish Airline Pilots’ Association told the carrier this week that they would halt work for a day on Dec. 20 over Ryanair’s refusal to recognize labor groups, while Vereinigung Cockpit, which represents flight-deck crews in Germany, said Ryanair pilots based there planned stoppages “at any time,” though they declined to specify a date. A spokesman for Ireland’s Impact Union, which includes the pilots’ association, said Friday it would respond to Ryanair after studying the proposal. ‘Dramatic Change’ “This dramatic change in policy has been made to avoid widespread industrial action and disruption to service over the Christmas period,” Investec analyst Alex Paterson wrote in a note. The move raises the possibility that more staff at the company will also become unionized and that improved pay and conditions for pilots will “at least partially” erode the airline’s cost advantage over time. Ryanair shares fell 5.5 percent, the most since July, to 15.50 euros at 12:03 a.m. in Dublin, giving a market value of 18 billion euros ($21 billion). Ryanair said in its statement that unions will be recognized so long as they establish committees of its pilots to deal with issues relating to the company. There will be no engagement with pilots who fly for competitor airlines, the company said, calling on crews to call off planned walkouts. Lawsuits The company’s decision to work with unions follows a ruling in September by the European Union’s top court that the airline could face employee lawsuits wherever cabin crew are based. That decision could pave the way for a flurry of claims outside of Ireland and a possible increase in employment costs, analysts had said at the time. Ryanair’s move Friday on unions could also reduce employment flexibility, wrote Sanford C. Bernstein analysts including Daniel Roeska. “Ryanair is likely to be forced to engage in lengthy negotiations processes,” they said. “In the longer term, the consequences could be profound.”