LATAM denies any hostile attempt to take over its Brazil operations, as reported by Wall Street Journal
LATAM Airlines strongly denied on Monday it has intentions of getting rid of its operations in Brazil, given the interest of its main competitor Azul airlines, as was reported by the Wall Street Journal indicating that there were ongoing conversations with Latam creditors to purchase its Brazilian affiliate.
Rather to the contrary LATAM, the region’s largest airline announced on Monday, it was preparing to deliver the restructuring program in the framework of Chapter 11, including Latam Brazil, while it continues recovering new routes, new operational bases and contracts.
However it is well known in the airline industry that Azul for months has shown an interest in acquiring Latam affiliates, but so far no confirmation has emerged. Nevertheless, given the intensity of the rumours, the Brazilian congress has addressed the issue and last Friday the Tourism committee from the Lower House held a meeting to discuss the consequences for local air traffic and consumers in the event of such an operation occurs.
The Committee invited representatives from the Consumers’ Defense Administrative Center; Citizen Attention Service and the National Civil Aviation Agency. The meeting was summoned on an initiative from lawmaker Eduardo Bismarck.
Most probably flight prices will increase because of the lack of competition. We must remember that currently ticket prices are below those of previous years and that is because of the current situation of the industry as a result of the pandemic, said the Brazilian lawmaker.
Civil Aviation representative Ronny Glanzmann admitted that we are not scared in the event of an acquisition process in that market, it’s clearly against our competition agenda, but we also understand it is a solution that the market has come up with.
He added, ”we are monitoring this process, but it is eminently private, a private negotiation and the government has not to interfere, it must not interfere because freedom of economic activity is enshrined in the (Brazilian) Constitution”.