Latin American carriers Avianca and Gol have agreed to join operations under a UK-based holding company while maintaining individual brands, a move intended to create long-term stability in the post-coronavirus environment. The principal shareholders of Colombia’s Avianca and the controlling shareholder of Brazil’s Gol have signed a landmark agreement to create a leading air transportation group across Latin America under a holding company structure named Abra Group Limited. Together, Avianca and Gol will anchor a pan-Latin American network of airlines that will have the lowest unit cost in their respective markets, the leading loyalty programs across the region and other synergistic businesses.
The companies say the transaction, which is expected to close in the second half of 2022, will allow them to better compete in international long-haul markets and in cargo markets, and enable them to launch new routes. Avianca’s owners and low-cost operator Viva struck a deal to form a joint holding company, a move intended to provide greater financial stability for the Latin American carrier’s post-pandemic. Control rights of Viva’s operations in Colombia and Peru are slated to move to the new holding company, contingent on regulatory approval. Until such point, Viva’s operations in Columbia and Peru will remain independent of Avianca. Colombian carrier Avianca last December become the first of three major Latin American airlines to complete court-overseen financial restructuring and emerge from Chapter 11 bankruptcy proceedings. The carrier had been forced into a formal restructuring process when the pandemic hit, and revenues collapsed.