dcajet
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United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 3:49 pm

More turmoil at Avianca Holdings: United Continental Holdings says Avianca second largest shareholder Kingsland (i.e. Roberto Kriete et al) has been granted "independent authority to manage" BRW (or Synergy) which remains majority shareholder of $AVH. United has also offered a $150 million loan to Avianca "if needed and requested".

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dcajet
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 3:59 pm

FYI for those who may not know it: Kingsland (The Kriete Family of El Salvador) is the family behind TACA, that merged with Avianca.
"Unattended children will be given espresso and a free kitten"
 
B764er
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 4:05 pm

OMG, AV has hit some turbulence! And Efromovich is out! Oh man, what's next?
Last edited by B764er on Fri May 24, 2019 4:20 pm, edited 1 time in total.
 
KlimaBXsst
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 4:08 pm

South America’s Airlines have been notorious basket cases for years!
Poof go the $$$’s.

Did United know not expect that with the loan?
Aesthetically the A 340 got it right!
 
2travel2know2
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 4:16 pm

So then, UA will do to AV sort of what Continental did to CM years ago?
Surely, many in Central America and beyond would love the idea of AV operations splitting into two separated airlines, one in Colombian hub BOG and the other in Central American hub SAL back with focus airports in GUA, MGA and SJO.
I'm not on CM's payroll.
 
usflyer msp
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Joined: Tue May 23, 2000 11:50 am

Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 4:16 pm

KlimaBXsst wrote:
South America’s Airlines have been notorious basket cases for years!
Poof go the $$$’s.

Did United know not expect that with the loan?


That is not true at all. LATAM and Copa are two of the most consistently profitable airlines in the world. Avianca was until recently and most of the issues there stem from Efromovich attempting to leverage his AV stake to prop up his other failing investments and installing managers that did not have a clear vision for the carrier. The Kriete's coming back is a good thing as I feel TACA was much better managed. TACA was not luxurious but they knew what their core markets could support and managed accordingly.
Last edited by usflyer msp on Fri May 24, 2019 4:21 pm, edited 1 time in total.
 
many321
Posts: 279
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 4:20 pm

Oh boy...I saw this coming. Though, what's next. Will Kriete head AV as whole or separate the Central American portion like he wanted to do for several years after he and Efromovich butted heads. Also, Kriete has invested in Volaris Costa Rica...will he try to bring Volaris into the fold...

Like some have mentioned before, the Central American community will be happy if Kriete separates TACA from Avianca since their fares have skyrocketed with sub-standard services.
Last edited by many321 on Fri May 24, 2019 4:26 pm, edited 2 times in total.
 
B764er
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 4:23 pm

UA is not stupid. If they knew they were loosing they wouldn't have even bothered.
 
KlimaBXsst
Posts: 215
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 4:26 pm

usflyer msp wrote:
That is not true at all. LATAM and Copa are two of the most consistently profitable airlines in the world. Avianca was until recently and most of the issues there stem from Efromovich attempting to leverage his AV stake to prop up his other failing investments and installing managers that did not have a clear vision for the carrier. The Kriete's coming back is a good thing as I feel TACA was much better managed. TACA was not luxurious but they knew what their core markets could support and managed accordingly.


Don’t get me wrong... after deregulation in 1978, our US Airlines could be considered economic dumpster fire until the shakeout of the 80s and 90s then 9-11 resulted in what we have now.
Aesthetically the A 340 got it right!
 
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adamblang
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 5:09 pm

usflyer msp wrote:
KlimaBXsst wrote:
South America’s Airlines have been notorious basket cases for years!
Poof go the $$$’s.

Did United know not expect that with the loan?


That is not true at all. LATAM and Copa are two of the most consistently profitable airlines in the world.

For every LATAM there's a Mexicana gone under, an Aerolineas Argentinas always hunting for a viable strategy. For every Copa theres a TAME on the verge, restructuring. There are two examples of well-run Latin American airlines and dozens of bad examples.
146 319 320 321 332 333 343 717 734 735 73G 738 739 744 752 753 763 764 772 773 789 AR1 AT4 CNA CR2 CR7 DC9 ER3 ERD ER4 E70 E75 E90
 
pipeafcr
Posts: 390
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 5:17 pm

many321 wrote:
Oh boy...I saw this coming. Though, what's next. Will Kriete head AV as whole or separate the Central American portion like he wanted to do for several years after he and Efromovich butted heads. Also, Kriete has invested in Volaris Costa Rica...will he try to bring Volaris into the fold...

Like some have mentioned before, the Central American community will be happy if Kriete separates TACA from Avianca since their fares have skyrocketed with sub-standard services.


No, Kriete just had a last minute interview with a reputable newspaper in Colombia and stated that he was not going to take control of Avianca but was appointed to set up a new board that will appoint AVH a new president. He wants to maintain AVH together and that the loan taken by Synergy will have to be paid solely by Afromovich.

I recommend you read the full interview here if you know Spanish: https://www.eltiempo.com/economia/empre ... ich-366472
Felipe Carrillo
 
usflyer msp
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 6:09 pm

adamblang wrote:
usflyer msp wrote:
KlimaBXsst wrote:
South America’s Airlines have been notorious basket cases for years!
Poof go the $$$’s.

Did United know not expect that with the loan?


That is not true at all. LATAM and Copa are two of the most consistently profitable airlines in the world.

For every LATAM there's a Mexicana gone under, an Aerolineas Argentinas always hunting for a viable strategy. For every Copa theres a TAME on the verge, restructuring. There are two examples of well-run Latin American airlines and dozens of bad examples.


So what? There are good and bad airlines in South America just like every part of the world. That hardly makes South America's airlines a basket case. If that was the case Europe's airlines are a basket case too - how many carriers on that continent have failed in the last 12 mos?

Beyond the two I mentioned
GOL is profitable
AZUL is profitable
VOLARIS is profitable
Sky Airline is profitable
Aeromexico is profitable
 
ual4life
Posts: 7
Joined: Wed Jan 13, 2010 8:10 am

Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 6:13 pm

B764er wrote:
UA is not stupid. If they knew they were loosing they wouldn't have even bothered.


As a die hard United fan, don’t be so sure of that.
Last edited by ual4life on Fri May 24, 2019 6:33 pm, edited 1 time in total.
NNVII
 
many321
Posts: 279
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 6:19 pm

pipeafcr wrote:
many321 wrote:
Oh boy...I saw this coming. Though, what's next. Will Kriete head AV as whole or separate the Central American portion like he wanted to do for several years after he and Efromovich butted heads. Also, Kriete has invested in Volaris Costa Rica...will he try to bring Volaris into the fold...

Like some have mentioned before, the Central American community will be happy if Kriete separates TACA from Avianca since their fares have skyrocketed with sub-standard services.


No, Kriete just had a last minute interview with a reputable newspaper in Colombia and stated that he was not going to take control of Avianca but was appointed to set up a new board that will appoint AVH a new president. He wants to maintain AVH together and that the loan taken by Synergy will have to be paid solely by Afromovich.

I recommend you read the full interview here if you know Spanish: https://www.eltiempo.com/economia/empre ... ich-366472


Read the article and he comes off stand offish. Though, perhaps it could be United putting a great responsibility on him.

Though, found hilarious in the way he mentioned that Efromovich is the one needing to deal with United. I
 
dcajet
Topic Author
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 9:38 pm

* Kriete with full control (facilitated by United)
* Board change.
* Contingent credit line of USD 250MM (completes the liquidity level fixed by the airline).
* Searching for new CEO
* Stock + 34% Bonds + 10%

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jbs2886
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 10:03 pm

usflyer msp wrote:
adamblang wrote:
usflyer msp wrote:

That is not true at all. LATAM and Copa are two of the most consistently profitable airlines in the world.

For every LATAM there's a Mexicana gone under, an Aerolineas Argentinas always hunting for a viable strategy. For every Copa theres a TAME on the verge, restructuring. There are two examples of well-run Latin American airlines and dozens of bad examples.


So what? There are good and bad airlines in South America just like every part of the world. That hardly makes South America's airlines a basket case. If that was the case Europe's airlines are a basket case too - how many carriers on that continent have failed in the last 12 mos?

Beyond the two I mentioned
GOL is profitable
AZUL is profitable
VOLARIS is profitable
Sky Airline is profitable
Aeromexico is profitable


Not sure Aeromexico and Volaris are South American Airlines....
 
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ACCS300
Posts: 430
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 10:35 pm

usflyer msp wrote:
adamblang wrote:
usflyer msp wrote:

That is not true at all. LATAM and Copa are two of the most consistently profitable airlines in the world.

For every LATAM there's a Mexicana gone under, an Aerolineas Argentinas always hunting for a viable strategy. For every Copa theres a TAME on the verge, restructuring. There are two examples of well-run Latin American airlines and dozens of bad examples.


So what? There are good and bad airlines in South America just like every part of the world. That hardly makes South America's airlines a basket case. If that was the case Europe's airlines are a basket case too - how many carriers on that continent have failed in the last 12 mos?

Beyond the two I mentioned
GOL is profitable
AZUL is profitable
VOLARIS is profitable
Sky Airline is profitable
Aeromexico is profitable


Not to nitpick but Aeromexico and Volaris are Mexican, Mexico is in North American, Latin American yes, but not South American at all.
 
usflyer msp
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 10:37 pm

ACCS300 wrote:
usflyer msp wrote:
adamblang wrote:
For every LATAM there's a Mexicana gone under, an Aerolineas Argentinas always hunting for a viable strategy. For every Copa theres a TAME on the verge, restructuring. There are two examples of well-run Latin American airlines and dozens of bad examples.


So what? There are good and bad airlines in South America just like every part of the world. That hardly makes South America's airlines a basket case. If that was the case Europe's airlines are a basket case too - how many carriers on that continent have failed in the last 12 mos?

Beyond the two I mentioned
GOL is profitable
AZUL is profitable
VOLARIS is profitable
Sky Airline is profitable
Aeromexico is profitable


Not to nitpick but Aeromexico and Volaris are Mexican, Mexico is in North American, Latin American yes, but not South American at all.


I would agree with you but since the other poster included Mexicana I thought I would include Aeromexico as a counterpoint.
 
77H
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 10:53 pm

My understanding is that UA is essentially infusing cash into AV to ensure they have a viable Alliance/JV partner long with Copa in the LatAm market. Wouldn’t it be better for United to try and push for a merger between Avianca and Copa which seems to be better run?

If I’m not mistaken, UA has already loaned $456M to AV’s parent company and is now offering $150M more. I can’t help but think UA could have pushed to merge the 2 airlines (even if brands are separate) rather than continue to throw money at AV.

Given the sorry state of many of UA aircraft interiors, I think $606M either loaned or offered could have been better spent offering UA customers a ride in a cabin that doesn’t look much better than a Greyhound.

77H
 
dcajet
Topic Author
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Re: United moves in on Avianca Holdings; Efromovich out

Fri May 24, 2019 11:18 pm

77H wrote:
My understanding is that UA is essentially infusing cash into AV to ensure they have a viable Alliance/JV partner long with Copa in the LatAm market. Wouldn’t it be better for United to try and push for a merger between Avianca and Copa which seems to be better run?

If I’m not mistaken, UA has already loaned $456M to AV’s parent company and is now offering $150M more. I can’t help but think UA could have pushed to merge the 2 airlines (even if brands are separate) rather than continue to throw money at AV.

Given the sorry state of many of UA aircraft interiors, I think $606M either loaned or offered could have been better spent offering UA customers a ride in a cabin that doesn’t look much better than a Greyhound.

77H


United did not give Avianca a penny. The money was loaned to BRW/Synergy, which is the largest Avianca Holdings shareholder. Synergy put those shares as a collateral for that loan. Since Synergy had not met the terms of the loan, UA is moving in to protect its interests.

COPA would be suicidal to merge with Avianca. It is one of the most consistently profitable airlines in the world, with a clear strategy predicated on its PTY hub and operating model. All a merger would achieve is to dilute COPA's success.
"Unattended children will be given espresso and a free kitten"
 
NWADTWE16
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Re: United moves in on Avianca Holdings; Efromovich out

Sat May 25, 2019 3:21 am

sad to see turmoil for Avianca, they really do run a great operation. New planes, friendly staff, great service on board and off. I hope this gets sorted and we don't lose yes another great carrier to madness.
I haven't been everywhere, but it's on my list!
 
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Coal
Posts: 2500
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Re: United moves in on Avianca Holdings; Efromovich out

Sat May 25, 2019 3:31 am

77H wrote:
My understanding is that UA is essentially infusing cash into AV to ensure they have a viable Alliance/JV partner long with Copa in the LatAm market. Wouldn’t it be better for United to try and push for a merger between Avianca and Copa which seems to be better run?

If I’m not mistaken, UA has already loaned $456M to AV’s parent company and is now offering $150M more. I can’t help but think UA could have pushed to merge the 2 airlines (even if brands are separate) rather than continue to throw money at AV.

Given the sorry state of many of UA aircraft interiors, I think $606M either loaned or offered could have been better spent offering UA customers a ride in a cabin that doesn’t look much better than a Greyhound.

77H

Your understanding could not be more wrong.
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