Copa Airlines, 5 New Destinations for 2006;
Aeromexico to go on the block; Varig running out of cash; Crisis nears end at LAB.
Copa Airlines daily flight to Montevideo besides others area cities.
Copa Airlines, subsidiary of Copa Holdings S.A. announced today it will begin flights to five new destinations in Latin America from its Hub of the Americas in Panama City, Panama starting in July. The new destinations are: Port of Spain, - Trinidad y Tobago; Manaus - Brazil; Santiago de los Caballeros - Dominican Republic; Montevideo ? Uruguay and San Pedro Sula -Honduras. Copa will operate the Montevideo route with Boeing 737 NG aircraft, and will utilize the Embraer 190AR aircraft on the flights to Manaos, Santiago and Port of Spain. Operating from its strategic location at the Hub of the Americas in the Republic of Panama, Copa currently offers approximately 80 daily scheduled flights to 30 destinations in 20 countries in North, Central and South America and the Caribbean. In addition, Copa provides passengers with access to flights to more than 120 other international destinations through code share agreements with Continental Airlines and other airlines.
Aeromexico to go on the block
The Mexican government-owned airline company Consorcio Aeromexico SA said late Tuesday it has decided to seek a buyer through a bidding process rather than privatize via a stock offering as had been considered. In a filing with the Mexican Stock Exchange, Aeromexico, Mexico's largest carrier, said majority shareholders chose to seek a strategic investor ??to promote the long-term operating and financial viability of the company,'' adding that the company will aim to complete the sale by the end of the third quarter. In February, the board of directors had considered the alternative of privatizing the company via a stock offering, which was possible because the government had already sold Mexicana, the other airline of former holding company Cintra SA last year. Antitrust regulators required that the two airlines be sold separately. Cintra sold Mexicana, the country's No. 2 airline, and its subsidiaries for US$165 million plus debt and other liabilities, but the bid for Aeromexico was considered too low, and Cintra held on to it with plans to sell it later. Aside from carriers Aeromexico and Aerolitoral, Consorcio Aeromexico has 50 percent of the ground services concern SEAT and the cargo airline Aeromexpress, as well as stakes in several smaller travel-related services companies.
Varig running out of cash The president of Brazil's debt-burdened flagship airline acknowledged yesterday that his company was running short on cash but said there was no risk its money woes would soon force it out of the skies. Marcelo Bottini said Viacao Aerea Rio-Grandense SA, or Varig would not be grounded in the near term, despite juggling more than US$2 billion in debt and facing federal demands for payments. Bottini's comments came in response to reports in the financial daily Valor and O Globo newspaper that the airline's financial problems would force it to suspend its flights as early as today, for failing to pay maintenance and airport bills on time, breaking agreements made earlier this year. Bottini said he had asked to meet with President Luiz Inacio Lula da Silva to discuss plans to rescue the ailing company, which already is operating under bankruptcy protection. He also said he was seeking a line of credit to cover airport fees and fuel costs, to help the airline through Brazil's off-season. Varig owes the federal airport administration some US$54 million and spends about US$422,000 to cover its airport fee each day. Yesterday, creditors appeared to reject an offer from Volo do Brasil, which purchased the airline's former cargo subsidiary VarigLog in January for US$46 million. Volo do Brasil had offered to buy Varig for US$350 million, without taking responsibility for any of the company's debts. Under the proposed deal, Volo do Brasil was expected to lay off about half of the airline's 10,000 employees.
Crisis nears end at LAB The Bolivian government reached a tentative accord yesterday to help end a crisis that put airline Lloyd Aereo Boliviano on the verge of bankruptcy. LAB's president Ernesto Asbun agreed to the demand of pilots and employees that he resign and sell his stake in the airline. LAB workers have been holding strikes and disrupted flights around the country last week by blocking airport runways. The airline's pilots and other workers walked off the job in February, demanding back wages as well as payment of the carrier's debt to its pension system. The carrier has more than US$160 million in debt. The company is controlled by foreign investors, with the Bolivian people ? not the government ? holding just under 50 percent of the shares. The Bolivian portion is held in a trust, managed by foreign financial institutions that cannot legally be touched by the Bolivian state. The government intervened in the management of the airline several weeks ago, ending the earlier strike. But new walkouts resumed last week after the Constitutional Court declared the intervention illegal. LAB flights to Madrid have been cancelled, but most of its other flights are operating normally, the airline announced.(Agencies)