Delta is buying 20% of LATAM
Delta Air Lines said it would buy a 20 per cent stake in LATAM Airlines Group for US$1.9 billion. The LATAM deal is Delta's largest since it merged with Northwest Airlines a decade ago.
The company is thus creating a major new airline partnership and ending the Chilean carrier's ties with American Airlines
Stocks impacted: Delta Air Lines (DAL), American Airlines Group Inc (AAL)
This step is an unexpected twist for American Airlines, which had pursued a joint-venture agreement with its code-share partner LATAM. However, American Airlines Group said the loss of its Chilean partner would not have a significant impact on its financial results. Delta said expects to exit its stake in Brazilian carrier Gol, which competes with LATAM in Brazil. Regulators in the U.S. and in Chile, where LATAM is headquartered would have to approve the Delta stake. In Thursday, the company’s shares rose 0.8% and could extend gains on the news about a deal.
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