For Immediate Release | Official News Wire for the Travel Industry

Where press releases are breaking news

Ailing Avianca’s plan to sell airport slots might be rejected

by

Avianca is the fourth largest airline in Brazil, and it has been in judicial recovery since December of last year with debts of approximately R$500 million.

A new plan approved by Avianca’s creditors on Friday is not setting well with Brazil’s anti-trust agency, CADE. The agency said that depending on which competitors buy out Avianca’s main airport slots, the operation may not be approved.

The approved plan includes the partition of the company’s assets into 7 parts, called Individual Productive Units (UPIs). Six of the UPIs will be made up of slots (airport landing and take-off times), employees and aircraft, and the seventh will hold Avianca’s loyalty program, Amigo.

It is CADE’s expectation is that agents will find the best solution to suit the private interests of Avianca’s shareholders and its creditors as well as the public interests of Brazilian consumers.

Included in each UPI will be the registration and authorizations of routes and the right to use slots at Congonhas (SP), Guarulhos (SP), and Santos Dumont (RJ) airports, in addition to the temporary right of use of the Avianca Brasil brand and the Air Operator Certificate approved by the National Civil Aviation Agency (ANAC).

CADE stated that the best case scenario would be for a new company to assume the operation of the units for which there would be no change in the concentration level of the sector. But if the UPIs are acquired by Gol or Latam, the agency sees problems, because these two companies already have high market shares in the main routes in which Avianca operates. Both Gol and Latam have announced interest in purchasing some of the Avianca’s assets.

Azul Airlines had announced earlier that it had made an offer to acquire Avianca Brasil’s assets, including airplanes and airport slots for US$105 million.

Travel News | eTurboNews

United Airlines appoints new VP

by

United Airlines today announced Michael Leskinen has been named vice president of Corporate Development and Investor Relations. Leskinen currently serves as managing director of Investor Relations. In his expanded role Leskinen will also lead United’s strategic investment activities including United’s investment activity in partner airlines.

“Mike’s experience as an investor and knowledge of the industry, along with his success in building strong shareholder relationships, make him the right executive to also lead our corporate development efforts,” said Executive Vice President and CFO Gerry Laderman.

“We have demonstrated that United is on the right path with our strategic plan and have just begun to realize United’s full potential. As we look to the future, we will continue to make disciplined investments that further our competitive advantages. Mike’s background makes him uniquely qualified to weigh those investments against the intrinsic value in our own shares,” said President Scott Kirby.

Leskinen joined United in January 2018 and in that time has played a vital role in improving the company’s relationship with shareholders. Prior to joining United, Leskinen was an executive director at J.P. Morgan Asset Management, where he led the firm’s investment efforts in aerospace, defense, and airlines.

Leskinen received his bachelor’s degree in finance from Arizona State University and his M.B.A. from the University of Pennsylvania. Leskinen will report to Laderman. Leskinen and his wife live in Chicago and have three daughters.

Travel News | eTurboNews

Alitalia airline: The ongoing medley

by

The journey of Gianfranco Battisti, CEO of Ferrovie Dello Stato Italiane (FS), to the United States would have borne its first fruits in the definition of the new company for Alitalia, but so far nothing is definite.

Delta Airlines, in fact, should officially join the new Alitalia, but with an initial share of only 10%. The commitment signed with the managing director of FS doubles over the next four years to satisfy the industrial plan still being defined.

The managing director of Delta, Ed Bastian, would, therefore, have confirmed the interest for a percentage of shares similar to those already held in Air France-KLM, even if now FS will have to increase its participation up to 40%.

The US carrier, in fact, will guarantee its gradual investment to the point of controlling 20% as long as the new company makes profits, a scheme that follows the operation that Delta has already successfully experienced with Aeroméxico (from 19 to 49% in the past few years.)

According to the Italian press, the Battisti-Bastian confrontation would have focused on the shares of the new team, its shareholders, and governance, while the definition of the industrial aspects of the plan will need more time. As a result, a further postponement of the presentation of the Alitalia business plan is expected to be scheduled for next March 31.

easyJet’s second thought

In a peremptory tone through a press release, easyJet definitively closes the door on a possible entry into Alitalia. “Following the conversations with FS and Delta Air Lines for the creation of a consortium that evaluated the options for future Alitalia operations, easyJet decided to withdraw. However, the airline told the Adnkronos agency of its intentions to confirm its commitment to Italy and to continue to invest in the three airports of Milan, Naples, and Venice as done in recent years, adding routes and capabilities.”

The NewCo scheme

In the new Alitalia, therefore, 50% would be controlled by FS and Delta and another 15% would be due to MEF (the Italian Ministry of Economy and Finances) through the conversion of a bridge loan. It remains to be clarified how the remaining 35% would be divided. According to the newspaper Il Messaggero, in fact, Battisti would have obtained from the Treasury the availability of Fincantieri to cover 10-15%, while an additional 20% would remain to be covered (there are talks again of CDP – Italian National Promotional Institution) or Poste ( the state mail company) through some subsidiary companies. The new Alitalia could start with a capital requirement of around 1 billion euros.

While waiting for its future to be defined, Alitalia states to have recorded a 2.7% increase in passenger numbers on intercontinental routes compared to the same month of the previous year. And passenger revenue traffic is up by 1.2% on long-haul flights compared to the same period in 2018.

February cargo revenue, as stated by Alitalia, also increased by 4.9%. The results obtained on intercontinental routes have contributed to overall revenues, allowing Alitalia to record for the fifteenth consecutive month, growth in total passenger traffic turnover.

Travel News | eTurboNews