RJ_Delta
Topic Author
Posts: 1391
Joined: Sun Oct 22, 2000 4:17 am

Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 1:44 am

Today in El Mercurio (the most important newspaper in Chile) appears an article that LAN is evaluating the acquisition of Aeromexico . According with the Chilean media, LAN have realized negotiations with the majority shareholder of AeroMéxico: the State.

According with the El Mercurio sources, closer (said) to the LAN' major shareholders, indicates that they are not 100% sure to taking over of the 60% of AeroMexico, when the mexican airline would be sold probably in September.

Source (only in Spanish)
http://diario.elmercurio.com/2007/06...B9FE3-F05A-4DA7-A089-A9EB25E99511}

This information is very interesting and also curious, because the last year LAN CEO Enrique Cueto said that LAN has no interest to enter into mexican market because the excessive competition with the mexican low cost the with US carriers which they are in expansion to Latin America specially Mexico.
 
usair320
Posts: 909
Joined: Mon Nov 10, 2003 9:53 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 1:48 am

I could just imagine it now. LAN Mexico. Actully I think AM would do great under Chilean management.(just keep th 772's!!)Although the article states LA is looking to aquire 60% stake in AM.
 
BrianDromey
Posts: 1932
Joined: Sun Dec 10, 2006 2:23 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 1:49 am

Interesting,

Alliance - LAN = oneworld ; AeroMexico = SkyTeam
Short Haul - LAN = A32X ; AeroMexico = 737
Long Haul - LAN = A340/763ER ; AeroMexico = 777

On the face they seem polar opposites, but it could be a good way for LAN to get its foot in the door of N.America, and could, potentially leave oneworld very dominant accross the Americas, with the exception of Canada.

Brian.
Next flights: MAN-ORK-LHR(EI)-MAN(BD); MAN-LHR(BD)-ORK (EI); DUB-ZRH-LAX (LX) LAX-YYZ (AC) YYZ-YHZ-LHR(AC)-DUB(BD)
 
RJ_Delta
Topic Author
Posts: 1391
Joined: Sun Oct 22, 2000 4:17 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 2:25 am

After that LAN-TAM agreement, TAM blocked the posibilities to LAN to enter Brazilian market now the LAN Airlines looks to Mexico.

Quoting Usair320 (Reply 1):
I could just imagine it now. LAN Mexico

I doubt that LAN could establish LAN Mexico in the case that the airline adquire Aeromexico.
 
juventus
Posts: 2017
Joined: Tue Dec 07, 2004 11:12 pm

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 4:27 am

Quoting RJ_Delta (Reply 3):
I doubt that LAN could establish LAN Mexico in the case that the airline adquire Aeromexico.

Agree.

Where's this 60% coming from??? Correct me if I'm wrong, but doesn't the Mexican government restrict foreign ownership to 25%? A couple of months ago, there was an article about Singapore looking at AM as well.
 
RJ_Delta
Topic Author
Posts: 1391
Joined: Sun Oct 22, 2000 4:17 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 8:11 am

Quoting Juventus (Reply 4):
Where's this 60% coming from???

According with info published today could indicate that is the part of the company that the State will be sold. Maybe some people has more information from AeroMexico about this new.

Anyway the Info published today has not confirmed yet by LAN Airlines.
 
Arcano
Posts: 2299
Joined: Mon Mar 22, 2004 4:34 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 10:29 am


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Well, after all AM already took LA's livery...
in order: 721,146,732,763,722,343,733,320,772,319,752,321,88,83,744,332,100,738, 333, 318, 77W, 78, 773, 380, 73G, 788, 789, 346
 
LipeGIG
Posts: 5048
Joined: Tue May 03, 2005 7:33 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 11:39 am

Quoting RJ_Delta (Reply 3):
After that LAN-TAM agreement, TAM blocked the posibilities to LAN to enter Brazilian market now the LAN Airlines looks to Mexico.

In fact i would say that Varig acquisition by Gol has blocked the possibilities to LAN in Brazil. The partnership with TAM just secured the access to the market.
As the other players in Brazil are very little (Ocean Air and BRA), LAN probably looks for Mexico, the 2nd biggest market in the Latin America in order to grow even more in the region.

Seems that consolidation in Latam is coming quicker than any one ever expect.

Felipe
New York + Rio de Janeiro = One of the best combinations !
 
RJ_Delta
Topic Author
Posts: 1391
Joined: Sun Oct 22, 2000 4:17 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 12:18 pm

Quoting LipeGIG (Reply 7):
In fact i would say that Varig acquisition by Gol has blocked the possibilities to LAN in Brazil

You 're right but with TAM agreement also block the entrance into Brazil, specially when Marco Antonio Bologna said that TAM is again that a foreign carrier operates inside the Brazilian market, and with the alliance with TAM LAN doesn't need to former a Brazilian airline to offer flights inside the country.

Anyways at this moment LAN has no decided yet to enter to AeroMexico. Maybe on Monday we have more information about this new.
 
juventus
Posts: 2017
Joined: Tue Dec 07, 2004 11:12 pm

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 1:22 pm

Reading the article, this is the piece I find interesting:

"La compañía es atractiva por su tamaño en un mercado importante como México, pero su estructura es ineficiente. Mientras en LAN los costos de explotación representan poco menos del 60% de sus ingresos, en el caso de AeroMéxico bordean el 90%."

True, unfortunately

I still think if LAN gets a piece of Aeromexico, it will be limited to nothing more than investment, sore of a small portion of the airline with not much say in what goes on. LAN will not like the conditions and walk away, just like IB walked away from Mexicana last year.

If LAN does make it into the Mexican market, well the sky is the limit. Could give the US airlines a run for the money.
 
OB1504
Posts: 2985
Joined: Tue Jul 27, 2004 5:10 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 1:45 pm

Personally, I hope that Lan, if they choose to go ahead with the acquisition of AeroMexico, will keep their brand name. To me, at least, it seems well-known across Mexico and the US, and messing with that might cause somewhat of a backlash at a foreign airline taking over and renaming what is, in effect, Mexico's flag carrier. Lan's already had problems regarding this in nationalistic Peru.
 
ghost77
Posts: 4458
Joined: Wed Mar 01, 2000 2:07 pm

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Sun Jun 03, 2007 4:15 pm

If LA gets its hands over AM, it would definetly had to keep AM's brand., it would be very stupid if LA let the brand go. I really hope LA gets its hands over AM in over a 51% or more!! Whatever works better for LA... if that happen, AM will become a true leading and first class carrier... LA is top notch... LA has done very wonderfull things with MY.. i know it from first hand and other experiencies about how MY works and its staff is really compromised with the airline and they treat them very well and trainning is the best. In the last decade.. the only good thing about AM is the T7... if this happens, It would be the best thing for AM in a long time.
Ricardo Morales - flyAPM - ¡No es que maneje rapido, solo estoy volando lento!
 
KLM685
Posts: 1506
Joined: Sat May 21, 2005 12:41 pm

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Mon Jun 04, 2007 1:35 am

Quoting Usair320 (Reply 1):
Actully I think AM would do great under Chilean management

Well I think opposite. Due to the long history of Aeromexico a foreign carrier managing the airline would be a disaster! Just imagine the deals with the unions,etc...

Quoting Juventus (Reply 4):
but doesn't the Mexican government restrict foreign ownership to 25%?

Exactly.


What Aeromexico need is a total renewal and a good management ( that could be well found in Mexico) and then think about foreign investment.
KLM- The Best Airline in the World!
 
PPVRA
Posts: 7865
Joined: Fri Nov 12, 2004 7:48 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Mon Jun 04, 2007 3:39 am

Quoting RJ_Delta (Thread starter):
This information is very interesting and also curious, because the last year LAN CEO Enrique Cueto said that LAN has no interest to enter into mexican market because the excessive competition with the mexican low cost the with US carriers which they are in expansion to Latin America specially Mexico.

But AM is already a well established carrier, so that problem is minimized. Thus, I think LAN would not be smart in getting rid of the AeroMexico brand for LAN Mexico. They can have "A LAN Group Airline" in small writings next to their logo like AF/KL does, but that's as far as I would go.

As for the foreign ownership limit, that's a whole different matter. . .
"If goods do not cross borders, soldiers will" - Frederic Bastiat
 
EddieDude
Posts: 6175
Joined: Fri Nov 14, 2003 10:19 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Mon Jun 04, 2007 4:32 am

Quoting Juventus (Reply 4):
but doesn't the Mexican government restrict foreign ownership to 25%? A couple of months ago, there was an article about Singapore looking at AM as well.

Foreing ownership is restricted to 25% of the voting stock. On a fully diluted basis, a foreign investor could own more than 25% if it obtains the authorization of the Comisión Nacional de Inversiones Extranjeras to acquire non-voting shares (known as acciones neutras).
Next flights: MEX-LAX AM 738, LAX-PVG DL 77L, SHA-PEK CA 789, PEK-PVG CA A332, PVG-ORD MU 77W, ORD-MEX AM 738
 
juventus
Posts: 2017
Joined: Tue Dec 07, 2004 11:12 pm

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Mon Jun 04, 2007 6:22 am

Quoting EddieDude (Reply 14):
Foreing ownership is restricted to 25% of the voting stock. On a fully diluted basis, a foreign investor could own more than 25% if it obtains the authorization of the Comisión Nacional de Inversiones Extranjeras to acquire non-voting shares (known as acciones neutras

Thanx for the explanation Eddie. When Iberia withdrew from the Mexicana sale, I read their CEO said something to the effect of "no nos interesa mas la compra si vamos a tener las manos atadas". I assume he was refering to this. Some companies don't want to only invest in AM, they want to call some of the shots.

If LAN gets a hold of AM, it will be a welcome change. I put them up there with the best in the world
 
Arcano
Posts: 2299
Joined: Mon Mar 22, 2004 4:34 am

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Mon Jun 04, 2007 10:25 am

According to El Mercurio, there is an interesting comparison of the two airlines:

Passengers 2006
LAN:
8.8 millions
Aeromexico:9.8 millions

Turnover 2006
LAN:
US$ 3.034 millions
Aeromexico:US$ 1.1969 millions

Profits 2006
LAN:
US$ 241 millions
Aeromexico: US$ -47 millions

Domestic Marketshare
LAN:
Chile 73%, Peru 58%, Argentina 13%
Aeromexico: 40%

Market Value
LAN:
US$5.563 millions
Aeromexico: US$212 millions

# Aircraft
LAN:
74
Aeromexico:73 jets, 8 turbo, 25 regional jets

Interesting, isn't it?
in order: 721,146,732,763,722,343,733,320,772,319,752,321,88,83,744,332,100,738, 333, 318, 77W, 78, 773, 380, 73G, 788, 789, 346
 
adriaticus
Posts: 989
Joined: Thu May 06, 2004 3:29 pm

RE: Unconfirmed: LAN Airlines Looks To Aeromexico

Mon Jun 04, 2007 1:30 pm

Quoting Juventus (Reply 4):
Where's this 60% coming from??? Correct me if I'm wrong, but doesn't the Mexican government restrict foreign ownership to 25%?



Quoting Ghost77 (Reply 11):
I really hope LA gets its hands over AM in over a 51% or more!! .



Quoting EddieDude (Reply 14):
Foreing ownership is restricted to 25% of the voting stock. On a fully diluted basis, a foreign investor could own more than 25% if it obtains the authorization of the Comisión Nacional de Inversiones Extranjeras to acquire non-voting shares (known as acciones neutras).

Right, Eddie. And I don't see this happening. It'll be a cold day in Calcutta before the current federal administration gives its enemies so much bashing material...

Quoting KLM685 (Reply 12):
Quoting Usair320 (Reply 1):
Actually I think AM would do great under Chilean management

Well I think opposite. Due to the long history of Aeromexico a foreign carrier managing the airline would be a disaster! Just imagine the deals with the unions,etc...

Right, Alonso. Foreign ownership and self-conscoious unions (and ASSA and ASPA sure are) usually find themselves in collision course.

I so much hope AM remains in Mexican hands - just like MX. However, I tend to believe a common talk everywhere lately... if acquiring AM was a reasonably good business, C Slim would be going after it already... He is helping his Volaris fly high instead... Mmmmmmm... Wait! ... Could there be any chnce AeroMexico and Volaris find sinergies and conjoint efficiencies in the short future?
 scratchchin 

Oh, well..

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