Brazil airline Gol's new offer for loyalty plan boosts shares

Brazilian airline Gol Linhas Aereas Inteligentes made a fresh bid Monday to take over its lucrative loyalty program, Smiles Fidelidade, lifting shares of both. Smiles jumped around 20% and Gol, the country’s biggest domestic airline, climbed nearly 4% as investors reckoned the more generous offer might convince minority shareholders. Gol already controls Smiles with a 53% stake and has been trying to buy the rest since October 2018, when it offered minority shareholders a share swap. On Monday, it made a revised offer of both cash and shares, at a premium of about 25% based on Friday closing prices. The premium has grown as Smiles shares have fallen to near their lowest level in four years. Gol’s first takeover bid had wiped out 40% of the loyalty program’s market cap and its weak 2020 forecasts sent shares tumbling further this month. “The no-deal situation created a corporate governance misalignment that was a major negative for the loyalty program,” BTG Pactual analyst Renato Mimica told clients in a note. Gol Chief Financial Officer Richard Lark told analysts in a conference call that the deal does not require regulatory approval and would boost the airline’s earnings per share by 0.40 reais next year.<br/>