Colombia’s Avianca and Brazil’s GOL have agreed to a merger, creating a pan-Latin American airline network. The airlines will remain independent brands but benefiting from greater efficiencies under aligned ownership, and the lowest unit costs in their respective markets. They will operate under a holding company structure named Abra Group.

Through recent investments made by Avianca’s and Viva’s shareholders, the group will also own a non-controlling 100% economic interest in Viva’s operations in Colombia and Peru as well as convertible debt representing a minority interest investment in Chile’s Sky Airline.

Together, Avianca and GOL will anchor a pan-Latin American network of airlines that will have the lowest unit cost in their respective markets, the leading loyalty programs across the region, and other synergistic businesses. Avianca and GOL will continue to maintain independent brands, talent, teams, and culture while benefiting from greater efficiencies and investments under common aligned ownership.

Abra will provide a platform for the operating airlines to further reduce costs, achieve greater economies of scale, continue to operate a state-of-the-art fleet of aircraft, and expand their routes, services, product offerings, and loyalty programs.

In the aggregate, the airlines under the Abra Group ownership will offer customers the largest network of complementary routes, with minimal overlap, across their markets.

Abra’s financial strength will provide long-term stability and agility to the participating airlines that will allow consistent and sustained investment in innovations and synergies.

Abra Group will be co-controlled by the principal shareholders of Avianca and the majority shareholder of GOL and be led by management with significant airline experience across the region, a long history of entrepreneurship, and a proven track record of growth and successful airline transformations.

Roberto Kriete, who will serve as the group’s Chairman, grew TACA in the 1980s into the leading Central American airline before merging it with Colombia’s Avianca Airlines in 2009. He also founded the leading Mexican carrier Volaris in 2006.

Constantino de Oliveira Junior, who will serve as the group’s CEO, pioneered Latin America’s low-cost carrier revolution when he founded GOL Airlines in 2001. Together with the acquisition of VRG in 2007 and Webjet in 2011, he led the company’s growth to a market-leading position.

Adrian Neuhauser, current President and CEO of Avianca, and Richard Lark, current CFO of GOL, will serve as the group’s Co-Presidents, in addition to maintaining their current roles at the airlines; further details on the Abra management team will be provided at closing.

Abra Group’s management will focus on achieving synergies to ensure the lowest cost structure in each carrier’s relevant market; expanding routes, services, product offerings, and loyalty programs; and developing innovative new products and services that will meet the evolving needs of passengers and air cargo customers in the highly competitive Latin American air transportation market and beyond.

Abra will also ensure that its operating airlines are ESG market leaders by providing enhanced governance as well as the financial strength to continue to invest in a lower carbon footprint fleet, which will significantly accelerate the airline industry’s path towards meeting carbon neutrality targets.

Roberto Kriete, Abra Group’s Chairman, said: “Our vision is to create an airline group that tackles 21st century issues and improves air travel for our customers, employees, and partners as well as the communities in which we operate. Our customers will benefit from access to even better fares, more destinations, more frequent flights and seamless connections, and the ability to earn and use points across the brands’ loyalty programs. They will also be able to enjoy enhanced travel benefits and access to superior products and services.”

Constantino de Oliveira Junior, Abra Group’s CEO, said: “This agreement places Abra’s airlines in a position to lead air travel within the region – serving a population of over one billion and GDP of nearly three trillion US dollars – providing significant opportunities for capacity and revenue growth. Our unique enterprise structure will allow each airline to drive results by maintaining their independent brands, talent, teams, and culture and will provide employees more opportunities for personal and professional growth at every stage of their careers.”