Colombia's Civil Aviation Authority Opposes Avianca Merger

Colombia's civil aviation authority on Tuesday formally opposed a planned merger between Avianca, the country's flag carrier, and budget airline Viva, saying the transaction represented a risk to competition, Reuters reported. Avianca and Viva in April signed a deal to merge into one group and unify their economic rights as part of a strategy to strengthen both airlines after the global aviation industry was battered by the COVID-19 pandemic. The civil aviation authority's decision tentatively blocks the merger, but it said the airlines can appeal. If the merger were to complete, the combined group would control 100% of the services offered on 16 routes, the authority said. Potential competitors would face new challenges for growth or expansion into markets affected by the bigger barriers to entry resulting from the control that the new entity would hold following the merger, the authority added. Read more.

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