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LAN hopes to complete TAM deal by early 2012

LAN hopes to complete TAM deal by early 2012

LAN Airlines has confirmed it expects to complete the takeover of TAM Airlines of Brazil in the first quarter of 2012, following conditional approval from regulators.

However, the carrier said it would assess the impact of conditions imposed by regulators in Chile.

The deal is set to create one of the largest carriers in the world when completed, with the new airline dominating the South American market.

Ignacio Cueto, chief operating officer at LAN, said administrative issues arising from the provisional approval will take up to five months to resolve.

“This pretty long process will continue to advance toward a possible integration with TAM,” he added.

An new airline is likely to be expected to quit one of the two global alliances LAN and TAM.

LAN is presently a member of oneworld group, while TAM is part of rival Star Alliance.

The measures also require LAN to modify its self-regulation and cancel and revise code-sharing agreements with airlines that do not belong to the same alliance as the newly merged LATAM on some routes.

LAN has been asked to cede four of its frequencies from Santiago to Lima to other Chilean airlines, which would also limit its flights from the Peruvian capital to other destinations.