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Delta to acquire up to additional 32% of Grupo Aeromexico outstanding shares

Delta to acquire up to additional 32% of Grupo Aeromexico outstanding shares

Old Nov 18, 15, 2:51 pm
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Delta to acquire up to additional 32% of Grupo Aeromexico outstanding shares

Delta intends to acquire up to an additional 32 percent of the outstanding capital stock of Grupo Aeroméxico S.A.B. de C.V. through a cash tender offer for MXP$43.59 per share. This investment will strengthen the airlines’ partnership, provide more travel options for customers in the U.S. and Mexico, and deliver the industry’s best customer experience.

Currently, Delta owns approximately 4.1 percent of the outstanding shares of Grupo Aeroméxico and holds an option to acquire an additional 8.1 percent. Separately, the Delta pension trust holds options to acquire approximately 4.6 percent of Grupo Aeroméxico. Following completion of the tender offer, Delta and the Delta pension trust collectively would own and/or have options to acquire up to a total of 49 percent of the outstanding shares of Grupo Aeroméxico.

“This new investment demonstrates Delta’s confidence in Mexico’s future and deepens our relationship with Aeroméxico, cementing Delta’s long-term commitment to the customers we serve to, from and through Latin America,” said Delta President Ed Bastian.

Delta intends to commence the tender offer once required regulatory approvals in Mexico and the United States have been obtained. The tender offer will be subject to terms to be disclosed and customary closing conditions, including the acquisition by Delta of a minimum number of shares in the tender offer. The transaction also is subject to approval by the Boards of Directors of Delta and Grupo Aeroméxico.
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Old Nov 18, 15, 3:00 pm
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Interesting.

Who do they buy in Asia then? Clearly the strategy seems to be to acquire stakes in airlines that serve vital/growing markets, and Asia is the one that seems to be left out.
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Old Nov 18, 15, 3:20 pm
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Originally Posted by phenobarbital View Post
Interesting.

Who do they buy in Asia then? Clearly the strategy seems to be to acquire stakes in airlines that serve vital/growing markets, and Asia is the one that seems to be left out.
Delta Air Lines to Buy China Eastern Stake for $450 Million

http://www.wsj.com/articles/delta-ai...ion-1438002207
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Old Nov 18, 15, 4:23 pm
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Originally Posted by Vuelos View Post
Delta Air Lines to Buy China Eastern Stake for $450 Million

http://www.wsj.com/articles/delta-ai...ion-1438002207
I remembered that one, but I was thinking more along the lines of a 49% stake. That may be hard given the amount of money involved.
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Old Nov 18, 15, 5:44 pm
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Originally Posted by phenobarbital View Post
I remembered that one, but I was thinking more along the lines of a 49% stake. That may be hard given the amount of money involved.
I think any Asian airline might have problems with government approval. Even if it's perfectly legal for DL to own 49% of the airline, the government might step in and not allow. Considering China Eastern and China Southern are controlled by Chinese government it might not want DL to own such a large percentage. KE seems to not really want to have much to do with DL. There's no other real partner large enough and that adds enough destinations to justify a purchase.
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