That TAP is being offered to LH is quite understandable, since Portugal is one of the PIGS (financially speaking) and the company is one of the its few valuable assets that may be of some interest to the almighty german government. Another story is the willingness of the gangsters in Cologne to swallow it without provoking some afterthoughts in a usually tame EU antitrust (while if IAG is involved they would immediately start howling).
What exactly LH can offer more than IAG to TAP? I'd say not much more unless they wanna make Lisbon their exclusive hub for SA...

for a self-described *A fan as you are should be difficult to admit that for once LH is in a disadvantaged position. I'd say that this merger will be approved unconditionally and being JJ the takeover target we can expect they will indeed join OW. Not for nothing LH/* has not wasted any time to enroll the next best option, TACA/AVIANCA.

I quite readily admit that things are not looking good for *A with regard to JJ , and I have never said that JJ won't/can't leave *A.

What I have said is that regulatory approval for LAN's takeover of TAM does not automatically equal regulatory approval for TAM to join LAN in OW.

It may happen, it may not, but one does not automatically follow from the other.

LAN and TAM joining forces actually produces fairly limited concerns from a consumer/competition perspective, there is very little overlap ( for obvious reasons I don't like the deal, but in and of itself, I don't believe the takeover is anti-competitive.)

TAM joining OW and ending up allied with AA as well could be viewed very differently from a consumer/competition perspective. When IB is added to the mix as well the combination could certainly be argued to be detrimental to competition and to the consumer and, in my opinion ( yes, I admit that it is opinion) I would expect that any relevant authorities would scrutinise such a move very carefully prior to approving it.

If it is your opinion that after the takeover a subsequent move by JJ to OW will be rubberstamped by any and all relevant authorities without any investigation at all regarding the concentration of market share and the impact on consumers/competition, well that's fine, you are also entitled to your opinion.

I fully expect the LAN takeover of TAM to proceed ( I don't deny that I would prefer it not to, furthermore, I think it was extremely unethical for TAM to have actually gone through with their accession to *A and only 3 months later announce their intention to be taken over by a member of a rival alliance - the deal had clearly been in the making for quite some time and I do not believe that JJ acted in good faith when they joined *A)

I am also not sure what you mean by 'for once' LH ( I assume you actually meant *A) is in a difficult position. *A has been in a difficult position in Latin America for a long time , and I freely admit that too.

Nice language.

I think LH has reached its management capacity in terms of integrating more troubled airlines. LH would be attractive as the bigger, financially more stable company with a proven model and experience in integration airlines while leaving their local infrastructures in place. IAG would of course also be a good partner with a bit less financial stability and experience. If I were LH I would try to bid for TAP and make it as expensive as possible for IAG to then finally get the airline.

I think the Potuguese government believe that more TP jobs will be protected by a LH takeover rather than a IAG one. Their fears (possibly justifiably) will be that IB will wish to route passengers to marginal destinations through their MAD hub and will cut back TP service. TP and IB share a focus on Latin America, and joining LH may be seen as a better way to protect TP's network and jobs.

BA would have to write in some concessions and binding stipulations to convince the Portuguese govt that TP won't be rolled into IB and MAD.

certainly they know that there are much more possibilities that LH will be allowed to gobble another airline without anyone in EU raising objections, contrary to what will happen should IAG be involved. However it remains to be demonstrated how TAP will be integrated into a monolithic monopoly, and what will be the costs involved on that.

IAG should do exactly the same, and instead concentrate on the biggest prize on the continent, LATAM.

Does LH not also have a Latin America focus, doubling up with TP on routes to GIG, GRU, CCS and EZE?

IB is stopping its services to Fortaleza and Recife so the destinations that IB and TP covers become the same as the destinations that LH and TP covers

http://www.bloomberg.com/news/2011-0...onditions.html

Lan Airlines SA (LAN)�s planned purchase of Brazil�s Tam SA (TAMM4) to form the world�s second-biggest carrier by market value was approved by Chile�s antitrust tribunal with several conditions.
Tribunal de Defensa de la Libre Competencia, or TDLC as the court is known, gave final Chilean clearance for the transaction in a split vote, according to a statement sent by e-mail today. Conditions include Lan and Tam opening up their frequent flyer program to other airlines, exiting one of their global alliances and capping Santiago-Sao Paulo fares until they exchange four daily slots in Sao Paulo�s Guarulhos airport with other carriers. The tie-up still requires Brazilian approval.

This link is in spanish:
http://www.estrategia.cl/detalle_noticia.php?cod=44972

When I translated it to English, there was a very important part to the conditions that LATAM has to agree on an here it is:

Rule number 6: Latam must resign within a period not exceeding 24 months from the date you accessed Operation materialize, at least one of the two global alliances, at that time involved parts, LAN and TAM. In no case may belong to one in which the group also Avianca / Taca is a member or associate, or is in the process of entering.

Rule number 7: For Avianca / Gol Taca or may not hold or maintain code-share arrangements in the other international routes within South America where superpogan air transport services with those of Latam.

Looks like it's bye bye to Star.

Indeed. Condition #6 for the approval of the merger is quite clear. LATAM has to be in one alliance only and cannot be in the same alliance AV/TA are members of or are in the process of joining.

Furthermore, no codeshares on flights to/from Chile (including connecting flights via South American gateways to Europe/North America) with airlines not members of the same alliance LATAM is in without the consent of the TDLC. No codeshares with AV/TA or G3 for South American flights on routes where both LATAM and AV/TA and/or G3 operate services.

At this point LATAM can either
1) bring JJ into oneworld
2) give up the merger
3) join Skyteam (both LA & JJ)

3) is most possibly a no go.

Quite interested in reading the feedback of the Brazilian antitrust authority. Anyhow good news for OW IMO. ^

You've made my day - its party time! I've always said that Government Regulators are very intelligent people -well except the ones that regulate financial markets........and banks........ and Airport charges in Australia..........and........but ones regulating dragging TAM out of Star - very intelligent people.

indeed that particular rule appears to specifically bar any * involvement in LAN. Also the clear notion about the "two" alliances involved in both parties rules out ST. So it will be OW definitely and that is a very good news. However i concur on what Kiwiandrew once said about TAM joining * just before finalizing talks with LAN, timing quite suspicious and overall a very poor behavior, unless they did this to purposely entice LAN.
Alliance wise now, Latin America should become like this:

OW: LAN, TAM and a good command of EU and US routes to the region;
*: Avianca, Taca + possibly Gol: this would help to get back the remains of Varig again in the alliance;
ST: Aeromexico + Aerolinas Argentinas: so far the losers in the region

+ Copa

So far as anything practical is concerned, the principal legacy of RG is the Smiles frequent flyer program. There are also a few lounges that Gol really has very little use for, such as the one in T2 of Gale�o. It gets very little use, as Gol flies from T1. Is there anything else left?