The CEO of bankrupt Scandinavian airline SAS, Anko Van der Werff, does not see the carrier’s position in the northern European market as “diminished” by recent market share grabs from the likes of Norwegian Air and Ryanair.
25.08.2023 - 14:15 / skift.com / Edward Russell / South America / Airlines
Colombia’s civil aviation authority, Aerocivil, is taking a new look at the proposed merger of Avianca and Viva Air following what it described as a “substantial irregularity” in its initial review. That process, which concluded in November, rejected the airlines’ combination due to competition concerns.
Aerocivil notified the airlines Thursday that it would “proceed quickly” to review the proposed deal again. The regulator did not say whether the process would take into account the concessions, including a commitment to keep the Viva brand and giving up slots at Bogotá’s congested El Dorado airport, that Avianca and Viva offered in November.
“Staying independent in aviation in the 2020s is not an option,” Viva CEO Felix Antelo said on the importance of the merger in an October interview. “It was hard pre-pandemic. It’s not an option now.”
Avianca and Viva would together operate a 61 percent share of seats in the Colombian market based on 2022 numbers, according to Diio by Cirium schedules. The next largest carrier, Latam Airlines, had a 24 percent share of seats.
The proposed merger is a precursor to a much bigger deal: the combination of Avianca and Brazil’s Gol under the new Abra Group banner. The two airlines plan to maintain separate operations but say the deal would allow them to realize other operational and backoffice synergies, for example placing joint aircraft orders. Abra would be akin to an Air France-KLM or International Airlines Group of South America, and challenge to regional market leader Latam.
The CEO of bankrupt Scandinavian airline SAS, Anko Van der Werff, does not see the carrier’s position in the northern European market as “diminished” by recent market share grabs from the likes of Norwegian Air and Ryanair.
The Avianca and Viva Air merger has hit a major roadblock with Colombian authorities objecting to the proposed combination. The move could be a blow to Avianca’s plan to create a pan-South American airline group with Brazil’s Gol.
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