This morning, an injunction was filed by a minority shareholder in Avianca to stop the deal between the airlines controlling shareholder and United. No word yet on the exact details or justification for the injunction. Back at the end of January, United and Avianca announced that they would work to enhance and deepen their commercial and strategic relationships.
“United and Avianca have a long history of partnership through Star Alliance, and we look forward to enhancing our cooperation to provide even better service for our customers,” said Scott Kirby, president of United. “Deepening our relationship allows us to expand on our existing Star Alliance and strategic partnerships in the region as we continue building a great network in Latin America.”
“The board of directors of Avianca has authorized Avianca to carry out all the analysis and other steps that are required for a potential strategic-commercial alliance with United Airlines,” the company said in a statement to Colombia’s financial regulator.”
That announcement came after months of speculation as to whether Avianca would strike deals with Copa, Delta, or United. Back in early June we reported that Delta and United were among the top contenders bidding for a controlling stake in Colombian carrier Avianca. The New York Times had details on the final bids submitted by Delta, United, and Copa.
United offered a $500 million loan to Avianca and potentially one of its investors. Copa pursued a merger that would value Avianca at more than $2 billion, or a 150 percent premium to its share price last week. Delta offered more than $1 billion in cash, a majority of which would go to buy out most of one owner’s investment arm, with the rest going to Avianca. The Delta bid implied a $1.9 billion valuation.
Avianca serves more than 105 destinations in 28 countries, with 180 airplanes operating 5,607 weekly departures and a total of 29.5M passengers in 2016. The carrier of course also operates the very popular LifeMiles loyalty program (which a sale to UA or DL would probably mark the end of in the future…so let’s hope for a stake instead).