Viva Aerobus and Volaris have reached an agreement to merge into a single low-cost airline group, with each company holding a 50 percent stake, according to a joint statement.
The two airlines will maintain their current operations under their separate operating certificates and distinct brands, preserving existing routes for passengers while expanding point-to-point travel options, the statement said.
Both airlines offer services in Mexico, the United States, and countries in Central and South America. Both began operations in 2006.
Under the terms of the agreement announced yesterday, the shareholders of Viva Aerobus and Volaris will combine their holding companies through a “merger of equals.” Upon completion of the merger, Viva shareholders will receive newly issued shares from Volaris’s holding company, and Volaris shareholders will retain their existing shares, the statement said.
Each shareholder group will own 50 percent of the resulting group.
The airlines stated in a press release that both Viva and Volaris will maintain their current operations under independent certifications and their respective concession titles, while expanding their capabilities.
They added that the formation of the group will broaden access to low-cost air travel and provide passengers with convenient point-to-point travel alternatives. Furthermore, the statement affirms, they “will continue to offer low fares and high standards of service.”
The merger agreement makes the ultra-low-cost model accessible to more passengers and generates economies of scale to achieve a more solid foundation for growth, they noted. “Recent supply chain disruptions and issues with equipment and engine manufacturers have had a disproportionate impact on the operating costs of ultra-low-cost and smaller airlines. As part of the airline group, Viva and Volaris will realize economies of scale to ensure sustainable growth, fleet optimization, and reduced fleet ownership costs.”
They mentioned that this agreement preserves and strengthens two recognized Mexican brands and allows them to be more resilient and competitive organizations, capable of thriving in new regional markets.
Source: jornada
