1,9 billion USD for flights to Chile. Delta Airline Company decided to make big investments. Part 1

Delta Air Lines will buy 20% of stocks of Latam holding for 1.9 billion USD. Alliance with the biggest Airline Company of Latin America will strengthen Delta positions on the market and stimulates growth of the stocks. In Stifel forecast their price increase by 52%.

American air carrier Delta Air Lines decided to buy 20% of the Chilian Airline Company Latam. Value of the transaction is estimate in amount of 1.9 billion USD. Stocks will be acquired at the price of 16USD per stock at the expense of the new debt obligations and money Press Service says. Latam is the biggest Airline Company in Latin America.

After the transaction Delta will invest in new partner 350 million USD and will acquire from Latam four airplanes Airbus A350. Besides, American Airline Company agreed to assume Latam obligation to buy ten additional airplanes A3650 with delivery till 2025. Delta declared that transaction will not influence free money flow or profit of the stockholders.

Consequences for Delta

Partnership with Latam will widen Delta presence in Latin America and will strengthen Delta positions in the struggle with main competitor American Airlines that tried earlier to create joint venture with Chilian carrier with which it cooperated through alliance of airline companies OneWorld.