Latam becomes the third airline interested in buying Colombian Viva Air

LATAM Airlinesthe largest air transport group in Latin America, announced its interest through its subsidiary in Colombia to buy the low cost airline Viva Airbecoming the third airline interested in merging with that company, a bid in which they also participate Avianca and jetSMART.

Colombia’s flagship airline, Avianca, signed an agreement with Viva in April 2022 for a business integration process aimed at rescuing the low-cost airline, but the Civil Aeronautics objected in November.

After an appeal by Avianca and Viva, the aviation governing body annulled the integration process in January due to irregularities in the procedure and reopened it.

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Although the two companies are still awaiting a response to their integration process from Civil Aeronautics, this month the ultra-low-cost airline JetSMART announced its intention to buy 100% of Viva, a bid to which added Latam Airlines Colombia.

“Latam Airlines Colombia, subsidiary of Latam Airlines Group SA, expressed its interest in starting negotiations to acquire Viva Air Colombia. said a statement issued Tuesday night.

“The company has informed that the operation is subject to a financial analysis, which it would have the capacity to carry out expeditiously, to an eventual agreement between the parties and to the corresponding regulatory approvals,” Latam added without disclosing details about the value of the eventual transaction.

The Colombian subsidiary of the Latam group assured that it is prepared and has the capacity to strengthen its operations in the country.

Latam affirmed that an eventual acquisition of Viva Air becomes a growth opportunity, offering Colombian consumers the best value offer in the local market in terms of service, and new alternatives to strengthen their connectivity and the development of tourism.

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Viva Air, which entered into a Business Recovery Process to renegotiate debts with its creditors and achieve its permanence in the market, said that it is reviewing the possible implications of the Latam announcement regarding the process that it maintains before the Civil Aeronautics for an eventual integration with Avianca .

Viva is going through a complex financial situation due to the impact of the COVID-19 pandemic, aggravated by the rise in the price of fuel during 2022 and the devaluation of the Colombian peso.

Latam, which came out of Chapter 11 of the US Bankruptcy Law last October, which it filed for in May 2020, has a fleet of more than 300 aircraft between Boeing and Airbus.

Viva, which emerged as a low-cost airline with operations in Colombia and Peru, has a fleet of 23 aircraft and some 1,000 direct employees.