MercoPress. South Atlantic News Agency

Avianca and Taca create a major Latinamerican airlines holding

Hopefully 130 planes won’t be enough for the new conglomerate

Two of Latinamerica's best known airlines are set to merge in a deal aimed at cost-cutting. Avianca of Colombia and El Salvador's Taca will join forces, but have said that each will maintain its own identity and operate separately. The two airlines have about 130 planes and some 13,000 employees.

Their combined routes cover about 100 destinations in the Americas and Europe - where they operate both passenger and cargo services.

Avianca's shareholders will get 67% percent of the stock in the new holding company while Taca's investors will take the remainder.

“This is a historic event in aviation, because we are bringing together two of the airlines with the most operating time in the world... to create a leading group in the industry,” said Avianca chief executive Fabio Villegas.

Bolivian-Brazilian tycoon German Efromovich and El Salvador’s Roberto Kriete, the two companies’ main shareholders, said in a joint press conference that the new airline will only be “strategic” since both will keep to their regional leadership, but will share their destinations in the Americas where they are strongly positioned.

“There’s no fusion of companies; as such they will continue to operate independently. What has appeared is a holding which holds the shares from both companies”, said Villegas. The new company will be registered in Bahamas.

“I think we are going to be short of aircrafts to keep growing”, said Kriete, when asked about the renewal of the fleet.

The new undertaking will have 60 international destinations, 20 sharede, 130 aircrafts and 13.000 employees distributed mainly in Colombia, El Salvador, Costa Rica and Peru.