BOGOTA (Reuters) – Colombia’s flagship airline Avianca is backing down from a merger with Viva Air, blaming circumstances set by the nation’s aviation regulator, the corporate introduced Saturday.
In an announcement, Avianca mentioned circumstances set by the regulator “wouldn’t enable Viva to be a financially and operationally viable airline,” and in addition put Avianca’s stability in danger.
Among the many causes, Avianca mentioned the deal gave little “regulatory flexibility” to reactivate Viva’s operations.
It additionally mentioned the deal required Avianca to imagine routes, commitments and costs that “do not coincide with Viva’s remaining capability” after having suspended operations for 2 months.
“Regretfully the circumstances of this decision, which is a agency choice, make the rescuing Viva unimaginable,” Avianca CEO Adrian Neuhauser mentioned within the assertion, including that the circumstances additionally however Colombia’s connectivity in danger.
Colombia’s aviation regultaor didn’t instantly reply to a request for remark.
The merger was a lifeline for embattled Viva, which has struggled financially within the wake of the coronavirus pandemic and seen its state of affairs worsen because of larger gas costs in 2022 and the depreciation of Colombia’s peso.
Colombia’s aviation regulator permitted the merger in late April after repeated delays, with the civil aviation authority objecting to the deal final November, earlier than annulling and reopening the method in January after citing procedural irregularities.
Amid the limbo, Viva Air abruptly suspended operations in late February, leaving passengers stranded in airports throughout the nation.
(Reporting by Oliver Griffin; Writing by Alexander Villegas; Enhancing by David Gregorio)
