no longer expects to finalize its merger with Grupo TAM by the end of the first quarter and will make no public comment on a new date for consolidation until mid-April at the earliest.
The airlines, which have deferred their merger several times because of regulatory reviews and lawsuits opposing their union, have for months said the deal will be completed by the end of March. Then, during LAN’s fourth-quarter results conference call in February, LAN executives said the completion date had slipped into the first week of April.
Neither airline has said much since then, but in the past week speculation has grown about a May 12 closure of the deal, and in several media reports issued this week that date appears to have been accepted as fact. This latest development has forced LAN to break its silence, and the airline’s remarks, while rejecting the May 12 rumor, show that a merger is not expected anytime soon and is still being reviewed by regulators in Brazil, Chile and the U.S.
“LAN clarifies that it is not possible to state a precise date for the merger closing, given that the merger is currently subject to the registration of the exchange offer with Brazil’s Commisao de Valores Mobiliarios and the Securities and Exchange Commission in the U.S., as well as the registration with the Chilean Superintendencia de Valores y Seguros,” says LAN.
These reviews mean the merger is on hold until all the required registrations are obtained, and according to LAN, that “is expected to take place in the next weeks.”
LAN says nothing about the process required for a formal merger after those approvals have been granted, although an airline executive attending the FIDAE air show in Santiago told Aviation Week the formation of Latam Airlines Group will be finalized in the second quarter.