Avianca has withdrawn its effort to acquire Viva, saying Colombian regulator Aerocivil’s conditions for approving the proposed merger would “make Viva’s recovery impossible and could even affect Avianca’s stability.”
The Colombian flag carrier says it offered to return more than 75% of Viva’s slots at Bogota El Dorado Airport (BOG), but “the authority demanded the return of such a number of slots that would not allow Viva to base a single aircraft at the country’s main airport efficiently. This would make Viva economically unviable, and explicitly contradicts other conditions that require that Viva continue to provide connectivity on the historic routes where it was the only operator.”
Avianca said in a May 13 statement that the “shortcomings” of Aerocivil’s resolution outlining conditions for clearing its acquisition of the Colombian ULCC “are numerous.”
Avianca says Aerocivil offered “little regulatory flexibility to provide certainty about the conditions for reactivation of Viva’s operations.” Viva grounded operations in February under severe financial distress.
Aerocivil’s conditions “require Avianca to assume obligations, routes and service and price level commitments that do not match Viva’s remaining capacity after two months of suspended operations,” Avianca says.
The Avianca-Viva merger was proposed in August 2022. Avianca said it is exploring “mechanisms to offer employment options to Viva employees.”
Avianca CEO Adrian Neuhauser says the regulator’s conditions “make it impossible to rescue Viva by making it not only unviable as an airline, but also, if the integration were to take place under the conditions imposed by Aerocivil, it would jeopardize Avianca’s stability and Colombia’s connectivity.”
He adds that Viva is “at imminent risk of disappearing.”
Meanwhile, the principal shareholders of Avianca and the controlling shareholder of Brazil’s GOL recently closed the transaction to create the pan-Latin American airline group the ABRA Group. Viva was supposed to be a part of the ABRA Group following its acquisition by Avianca.
