Azul and Trip announce merger.
Following the merger, Brazil's third-largest airline will double its fleet, but is not expected to exceed a 15% market share – compared to TAM's 38% and Gol's 34,4%.
247 — Azul, Brazil's third-largest airline, announced on Monday the merger of its operations with Trip. The union reduces the gap with the two leaders in the domestic aviation market, TAM and Gol. The new company, which should continue operating under the Azul brand, will hold almost 15% of the domestic flight market share, compared to 38% for TAM and 34,4% for Gol, according to data from the National Civil Aviation Agency (ANAC) for the month of March.
According to information from Exame.com, Azul's courtship with Trip is long-standing, but the agreement began to be negotiated six months ago. Factors in its favor included the fact that both airlines use the same aircraft, Embraer and ATR, and Azul's determination to expand its operations in regional aviation, since it is difficult to compete with TAM and Gol in large cities.
According to market sources cited by Globo, the operation is being led by Arminio Fraga of Gávea Investimentos, Companhia Bozano, and, primarily, Embraer, whose E-Jets family of aircraft are part of the fleets of both Azul and Trip. Both companies also operate French ATR 42/72 aircraft on their short-haul routes.
With the merger, Azul practically doubles its fleet, adding the 58 aircraft belonging to Trip to its current fleet of 49. Azul will hold 80% of the company's capital, while Trip's three shareholders (the Capriolli, Águia Branca, and SkyWest groups) will divide the remaining 20%.