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Delta Air Lines to Buy Minority Gol Stake for $100 Million - Bloomberg

Delta Air Lines to Buy Minority Gol Stake for $100 Million

By Karen Eeuwens - Dec 7, 2011 7:09 AM ET

Gol Linhas Aereas Inteligentes SA (GOLL4), Brazil’s second-largest airline by market value, said Delta Air Lines Inc. (DAL) agreed to buy a minority stake for $100 million.
Delta will buy the airline’s American depositary receipts backed by preferred shares, Gol said today in regulatory filing in Brazil. As part of the plan, Sao Paulo-based Gol plans to issue new preferred shares for an average price of 22 reais apiece, boosting its capital by about 280 million reais ($160 million).
Gol will appoint a Delta representative to its board on condition that the company retains at least 50 percent of the acquired shares, according to the filing. Atlanta-based Delta agreed not to sell its stake in Gol for 12 months and won’t buy additional shares of Gol without the airline’s consent.
The two companies also signed a long-term contract to increase code-sharing and transfer the leasing contracts for two Boeing 767 aircraft from Gol to Delta.
Delta’s investor relations department didn’t immediately respond to a telephone call and e-mail seeking comment.

acl65pilot

Makes sense and now Firstmob knows there that money from the slot swap went.

acl65pilot

What? There nothing protecting us in Section 1 from that?

FlyZ

Wow, it looks like they DON'T just want to be a ticket broker at this point! They also want to manage a small mutual fund made up of Central and South American airlines. Sounds awesome for the Delta pilots. We absolutely cannot afford new airplanes, gas to fly new routes, or pilot contract improvements. All extra cash must be spent on other airlines, preferably ones that can do our flying for us.

slowplay

How many widebody international aircraft does GOL operate? Last time I checked it was primarily a intra-South America 737 operator (122 total) and has 2 767's. Delta can't fly intra-country in Brazil due to cabotage laws (good thing, as it protects us at home). The current agreement allows Delta codesharing on 56 GOL flights out of Rio and Brasilia to 15 destinations inside Brazil. Apparently there's a conference call today for investors and the media that will discuss the investment.

So Star has TAM (Brazil) and UAL/CAL are larger in SA than Delta. oneworld has LAN (Chile and others), and AMR is the largest US-SA player. Delta and SkyTeam are in third place with limiited options. LAN/TAM are merging and will probably have to pick one alliance member. That leaves two major players and three alliances. Without help, Delta's service to SA could become a very distant third. Without domestic feed in SA, the losing alliance in the LAN/TAM merger will probably have to reduce service.

siemprerojo

Hello 80,

I actually like the silent treatment. The 2 year old taking a nap and getting the silent treatment is the only peace and quiet I get from the constant noise around me.
Is this wrong to feel this way?

Siempre Silence in Salt Lake

Other than looking at mi hermana's boobs what are other good ways of obtaining this silent treatment you speak of?

Timbo

Mo'Ron hosed DAL a long time ago, when he bought Pan Am, and DIDN'T buy their South American and MIA ops! AA took over MIA and the routes, which has been one of their most profitable segments.

Way to Go, Ron! And this idiot is still on the payroll...I wonder if he still has a parking space over at the G.O.?

slowplay

I agree with the sentiment, but AMR bought the old Braniff/Eastern routes and facilities. AMR was also politically savy enough to get MIA to make all airlines pay for the terminal upgrades that primarily benefited AMR. The PAA South America stuff went primarily to UAL.

Oh, and RA was fired from the payroll during bankruptcy. Contract Rejected!

Timbo

Thanks for clearing that up, my memory's good, but it's short...

;^)

Bucking Bar

What this pilot hears when reads the news ... Kinda sounds to me like we just picked up two 767's and will fly them ... if that's correct, YIPPEE!