Delta Air Lines offers to buy additional 32% stake of Aeroméxico

13 February, 2017

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Delta Air Lines announced plans to acquire up to an additional 32% stake in the outstanding capital shareholding of Grupo Aeroméxico S.A.B. de C.V. through a cash tender offer of US$ 2.60 per share.

Currently, Delta owns approximately 4.2 percent of the outstanding shares of Grupo Aeroméxico and holds options to acquire an additional 12.8 percent. If fully subscribed, following completion of the tender offer, Delta would own and/or have options to acquire up to a total of 49 percent of the outstanding shares of Grupo Aeroméxico.

Completion of the cash tender offer is subject to certain conditions including acceptance of the offer by holders of at least twenty-five percent (25%) of the outstanding shares of Grupo Aeroméxico and receipt of required antitrust approvals in Mexico, said the company in a press release.

Mexico's Chamber of Deputies will, later this month, vote on an amendment to increase the cap on foreign ownership of local airlines from the current 25% to 49%. The measure was approved by the Senate last December.

“This is the next step in expanding our longstanding relationship with Aeromexico, a partnership built on our shared commitment to our customers in the U.S. and Mexico,” said Ed Bastian, Delta’s Chief Executive Officer. “The tender offer and investment will further strengthen the relationship that will be established when our joint cooperation agreement is implemented in the second quarter.”

Delta and Aeroméxico launched their first codeshare in 1994. In 2011, Delta entered into an enhanced commercial agreement with Aeroméxico, and in 2012, Delta invested US$ 65 million in shares of Grupo Aeroméxico, the parent company of Aeroméxico.

In March 2015, Delta and Aeroméxico entered into a joint cooperation agreement relating to flights between the United States and Mexico and the parties filed an application with the U.S. Department of Transportation (DOT) seeking approval of the agreement and immunity from the United States antitrust laws for the joint cooperation.

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