Lan Airlines, Latin America’s biggest carrier by market value, agreed to buy Tam in an all- stock transaction valued at $3.7 billion. The combination follows similar tie-ups between U.S. and European carriers trying to reduce operating costs and increase revenue by offering a broader global market to passengers. Carriers worldwide have been battered in the past two years by record high fuel prices and a drop off of lucrative business travel during the economic slowdown.
Lan’s Enrique Cueto will become chief executive officer of the new company, called LATAM Airlines Group SA, while Tam’s Mauricio Rolim Amaro will be chairman. Tam’s controlling shareholders will retain 80 percent of Tam’s voting shares and Lan will own the remaining 20 percent to comply with Brazilian regulations, the statement said. The agreement calls for the delisting of Tam in Brazil. – Source