Gol Linhas Aereas Inteligentes and Colombia’s Avianca said on Wednesday they have agreed to create a holding company called Abra Group, bringing the two brands under the control of a single company. Abra Group will be jointly controlled by the principal shareholders of Avianca and the majority shareholder of Gol, they said, adding that both airlines would continue to operate independently and maintain their respective brands. They said other financial investors had committed to invest up to $350m in Abra Group upon the closing of the deal, which is expected in the second half of 2022. Abra, which has called itself a “pan-Latin American network of airlines,” will also own a non-controlling 100% economic interest in Viva’s operations in Colombia and Peru and a minority interest in Chile’s Sky Airline. Roberto Kriete will serve as the group chairman, while Gol’s founder Constantino de Oliveira Junior will be the chief executive. Avianca’s CEO Adrian Neuhauser and Gol’s CFO Richard Lark will serve as co-presidents. “This agreement places Abra’s airlines in a position to lead air travel within the region - serving a population of over 1b and GDP of nearly $3t — providing significant opportunities for capacity and revenue growth,” Oliveira said. Abra would focus on achieving synergies to ensure lower costs and expand routes, the firms said, without providing details. Gol said in a separate filing that the transaction involved its controlling shareholder, investment fund MOBI FIA, and certain shareholders of Avianca Holding including Kingsland International, Elliott International and South Lake One.<br/>
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Copa Holdings, the parent of Panama’s Copa Airlines, says Q1 2022 was profitable, but higher jet fuel prices will weigh on earnings during the next few months. “Thanks to the recovery in demand following the impact of the Covid-19 Omicron variant, and despite higher fuel prices, Copa Holdings reported a profitable quarter,” the Panama City-based carrier says on 11 May. “These results also reflect the company’s ability to increase capacity while operating with low unit costs.” During the first three months of 2022, Copa says it earned a profit of $19.8m, compared to a loss of $111m in the same three months of 2021. In pre-pandemic 2019 the company posted a profit of $89.4m. Revenue for the three months ending 31 March was $572 million, down 15% from $672m in the same quarter in 2019. Copa, which operates an all-Boeing 737 fleet, says it was forced to cancel 4% of its flights during the period due to Omicron-driven staff absences. Capacity as measured in available seat miles (ASMs) in Q1 was about 88% of the same quarter in pre-pandemic 2019. That’s up more than four percentage points from Q1 2021. While it expects capacity to rise to 96% of Q2 2019 ASMs, Copa is mindful that higher jet fuel prices will weigh on earnings. The company adds that the three months between April and June are also traditionally low travel months.<br/>
South Africa’s decision to sell a majority stake in the country’s loss-making national airline for just over $3 represents an ongoing financial risk to the state as the terms were skewed heavily toward the buyer, the National Treasury said. The finer print of the deal that saw the Takatso Consortium take a 51% shareholding in South African Airways last year represents a “contingent liability,” the Treasury said in a document emailed to Parliament’s Standing Committee on Public Accounts that was later withdrawn. That’s partly because Takatso—made up of a local jet-leasing company and private-equity firm—has the right to assess whether any ongoing liabilities in SAA be settled by the government, the Treasury said in the document seen by Bloomberg. The emergence of the concerns came as Public Enterprises Minister Pravin Gordhan was set to appear before the public-accounts committee. Gordhan, a former finance minister, had made the removal of SAA from the state roster a key tenet of his role overseeing he Department of Public Enterprises, which also counts debt-laden utility Eskom Holdings SOC Ltd. among its responsibilities. The terms “may result in the state providing funds in excess of its shareholding,” the Treasury said. While the letter was withdrawn, Finance Minister Enoch Godongwana said at the hearing that the National Treasury didn’t participate in the sale process and the substance of the “letter stands.” The department said it wouldn’t comment further on the document because it had been withdrawn and referred questions to the DPE.<br/>