LAN, TAM to merge

[SeaWolf]

LAN cannot merge with TAM as well as move the combine to *A - this has been mandated by both the Chilean and the Brazilian ratifications.

That's not true, *A could stop Avianca/TACA from joining in preference of LATAM instead. I'd think they would want to have the deal tied up with LATAM though before they halt the joining of Avianca/TACA.

 

[serfty]

That's not true, *A could stop Avianca/TACA from joining in preference of LATAM instead. I'd think they would want to have the deal tied up with LATAM though before they halt the joining of Avianca/TACA.

You are correct -however that is IMHO more unlikely than the combine joining *S.

 

[SeaWolf]

You are correct -however that is IMHO more unlikely than the combine joining *S.

The funny thing is, I can only find that one article referencing that particular condition. Given that almost every article about this merger mentions the alliance question, you'd think it'd be getting more attention, or at least mentioned in other articles. I'm wondering if it only applied in a draft decision or something and has since been dropped...
However, I can't seem to dig up the actual decision from either the Chile or Brazilian authorities anywhere, possibly because I speak no Spanish or Portuguese.

 

[SeaWolf]

Well, having too much time on my hands, I found the ruling from the Chile authorities.
http://www.tdlc.cl/DocumentosMultiples/Resolucion_37-11.pdf
Condition Six (according to Google Translate) reads:

LATAM will resign within a period not exceeding 24 months from the date of Operation consulted materialize, at least one of the two global alliances, at that time involved parts, LAN and TAM. In no case may belong to this alliance in which the group also Avianca / TACA is a member or associate, or is in process of entering into some of these qualities. LATAM In the event desiring to belong to more than a partnership, should consult this circumstance to this Court.

The translation is not fantastic, but it would seem to support the original article, they can't be in the same alliance as Avianca/TACA. I think the reason it's probably not getting brought up anywhere else is that the Avianca/TACA part is not mentioned in the summary of the conditions and going through a 154 page report in Spanish is more than most people are going to bother with when the summary will do just fine.

 

[serfty]

I must admit I have been looking at other forums where the translations may be more innate.

e.g. Here on FT: LAN buys TAM, *A implications.. - FlyerTalk Forums

 

[drron]

And a bit more evidence that LANTAM is going with OW-
http://www.lan.com/en_us/sitio_pers...&Email_PageName=20120109_vi_lancolombia_EN_US

LAN is moving from Terminal 4 to 8-the AA terminal.

 

[fjc]

Another comment on the merger, indicating that the merged airline will probably stay with OW.
Brazil's TAM Completes Share Swap for LAN Merger | Fox Business

 

[juddles]

They would be crazy to part with OW. The comments by Cueto that a final decision has not been made is hilarious. That in the 22 months they have to ¨make the decision¨ Avianca Taca would have to first go through the full process of integrating with Star Alliance and then also leaving it so LAN (sorry - ¨LATAM¨) could join?? Nonsense.

 

[elbarto]

Well judging by this: Avianca Taca Airlines - Star Alliance I don't think LATAM have a choice, unless they go to Skyteam.

 

[drron]

The merger has only just become official-22/7 Brazil time.Probably why no official decision has been made yet.
LATAM Airlines group is Latin America

The exchange offer, which was completed with the auction today, was subject to the condition that more than two-thirds of the TAM shares that participate in the offer agree with the disintegration of TAM as a public company in Brazil. This condition was satisfied when 99.9 percent of the participant shares agreed with these terms.

Also hadn't realised that the unions have such a major influence on Alliances-
Airline alliance unions meet in Buenos Aires - {Travel Daily News}

Unions representing workers from the major airline alliances are meeting this week in Argentina to share information and develop strategic responses to developments in the industry. They will cover issues such as the implications of the proposed LAN-TAM merger on Oneworld Alliance workers and the situation at Turkish Airlines, which has raised serious concern among Star Alliance unions.

 

[drron]

An article saying LATAM will not be part of * but might not stay with OW.
Folha.com - Internacional - En - Finance - TAM joins LAN and says it will leave the Star Alliance - 23/06/2012

TAM admitted yesterday it will no longer be part of the Star Alliance, an alliance of airlines of which it has been a member since May 2010.According to Mauricio Amaro, Chairman of the Board of Latam, the holding company combining LAN and TAM that was officially established yesterday, in the coming months the group will decide whether TAM will join the LAN's alliance, Oneworld, or "will be independent."

I would doubt that it would decide to be part of no alliance.

 

[serfty]

It seems an announcement is not far off: WSG - Brazilian Carrier Tam Nears Move to Join Oneworld Pact

SANTIAGO, Chile—The Brazilian arm of Latam Airlines Group SA LAN.SN +0.07% is close to a decision to join its Chilean sister company in the Oneworld global marketing alliance, changing the balance of power among South America's fast-growing carriers.

Latam, formed by the merger of Brazil's Tam and Chile's Lan earlier this year, had previously indicated it would reveal its alliance strategy by March 2013, but now a final decision is expected much sooner, according to people with direct knowledge of the situation.

Executives from Latam have in recent days held talks with Oneworld's two major partners, American Airlines parent AMR Corp. AAMRQ +3.15% and International Consolidated Airlines Group SA, IAG.MC -0.23% according to the people. IAG's stable of airlines includes British Airways and Spain's Iberia.
...

 

[drron]

And those talks with AA have resulted in a new codeshare agreement.TAM says it will take 11 months for the Brazilian government to ratify so may be a closer reliance like QF and emirates.
Brazil's TAM signs alliance with American Airlines - FRANCE 24
American CEO 'impartial' about merger, memo says | American Airlines bankruptcy | Americ...
American Airlines adds new agreements, flights in South America - Business - MiamiHerald.com

 

[drron]

It is now official-LATAM is going with One world-
...:: TAM LINHAS AÉREAS S/A - PAIXÃO POR VOAR E SERVIR ::...