Confirming what we announced on the night of April 28, Avianca Group issued a statement informing that Viva signed the agreement that makes it part of the holding and that Declan Ryan, founding partner of Viva, will join the group’s board of directors.
Thus, Avianca will assume operational and financial control of Viva and its Colombian and Peruvian subsidiaries once the relevant authorities issue the corresponding approvals.
The company indicates that “the eventual incorporation of the control rights of Viva’s operations in Colombia and Peru to the Avianca Group holding company will be subject to requesting and obtaining all the necessary regulatory authorizations in the countries so required.”
Therefore, while these authorizations are obtained, the carriers’ current operations and competition will remain the same in all markets in which both companies have a presence. At this stage then, there will be no unification of processes or sales or customer service channels.
Once approvals are obtained, both groups could be integrated into a single holding company, maintaining their brands and strategies.
“This new, strong airline group would benefit customers by having a more efficient cost structure that would allow us to offer even lower prices, in addition to a route network that would promote direct connectivity between destinations, a strong loyalty program and a friendly and efficient service in line with the needs of today’s traveler. It would also give Colombia and Latin America a new and strengthened competitor that would be sustainable over time, making both players continue to be relevant in the Latin American market,” said Roberto Kriete, Avianca’s principal shareholder and Chairman of the Board of Directors.
“This is an important day for Viva as it is the perfect scenario to continue with our growth and expansion strategy, maintaining the flag of air inclusion and strengthening our company. Furthermore, if in the future the authorities approve the management of both groups in the same holding company, it will drive the air transport market to continue growing, promoting low fares for users and good service with the best punctuality, giving everyone the opportunity to fly to many destinations around the world.” added Declan Ryan, founding partner of Viva.
“Likewise, it will be a source of qualified employment generation, providing more and better job opportunities for current and future employees, as well as continuing to positively impact the connectivity of Colombia, the region and the country’s economic development,” he concluded.
The structure of the Avianca – Viva agreement would incorporate a new holding company that would control the two companies (Avianca Group and Viva Latinoamérica) and would hold the economic rights of Viva’s subsidiaries in Colombia and Peru, while maintaining their assets separated to avoid conflicts of dominant position.
The incorporation of Viva Peru into the agreement suggests that the consolidation sought by Avianca’s shareholders will not be limited to the Colombian domestic market and that, having obtained the approval of the aeronautical authority, it will enable it to create a major player at the regional level.
