Delta To Increase Aeromexico Stake

February 13, 2017

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Delta Air Lines has launched a cash tender offer to acquire up to an additional 32 percent of Grupo Aeromexico, in a deal valued at USD$590 million.

Delta is offering MXN53 pesos per share for the stock, an increase from its previously announced tender price of MXN43.59. The increase is due to interim exchange rate movements and other factors, Delta said.

The US airline already has a 4.2 percent stake in Grupo Aeromexico, and has options to acquire an additional 12.8 percent. If the tender is successful and the options exercised, Delta will own 49 percent of Aeromexico.

Delta chief executive Ed Bastian said 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.”

The US Department of Transportation in December 2016 gave conditional approval of the joint cooperation agreement and immunity from antitrust laws. Mexico’s competition regulator, COFECE, also gave conditional approval.

Delta and Aeromexico have accepted the conditions required by COFECE and DOT and are in the process of implementing the required remedies.