Merger ambitions
On April 29, 2022, it was announced that Avianca intended to acquire Viva Air Colombia.[14][15] However, the Colombian Aerocivil had initially opposed the merger, citing concerns of competition reduction in the country.[16] Despite this, negotiations for Avianca's merger have continued, and a new proposal is currently underway.[17][18]
In February 2023, JetSmart and LATAM Colombia individually announced their intentions to acquire Viva Air as an alternative to Avianca.[19][18] In the same month, the airline filed for bankruptcy protection following impacts of the COVID-19 pandemic and merger with Avianca.[20] The company was forced to ground five aircraft from active service after the aircraft lessor claimed that Viva did not pay fees.[21]
On February 23, 2023, Felix Antelo announced that he was stepping down from his role as President and CEO of the Viva Air Group, citing his health which had "declined recently". He urged Aerocivil to "make a decision right now" regarding the Avianca-Viva merger, as the company was now in grave danger of disappearing entirely.[22] The company appointed Francisco Lalinde, previously their Vice President of Operations, as interim President and CEO of Viva Air.[23]
On February 27, 2023, Viva Air and its subsidiary Viva Air Perú suspended their operations indefinitely and grounded their entire fleet due to the financial crisis, blaming the situation on the delay in the response from Aerocivil on the Avianca-Viva merger authorization, stating that "The (civil aviation authority's) unprecedented decision will result in further delays in reaching a decision, for which Viva is forced to announce the suspension of its operations with immediate effect."[24][25][26]
On March 21, 2023, Aerocivil announced that it would approve the Avianca-Viva merger conditionally if the new entity complied with the following: to either refund or honor passengers' canceled bookings made prior to Viva Air's suspension of operations; to return some in-demand slots at Bogotá's El Dorado Airport previously held by Viva Air; to maintain Viva Air's low-cost model for consumers within Colombia; to reinstate flights between Bogotá and Buenos Aires; to maintain a fare cap on routes where the entity is the only operator; and, as the new entity would hold a majority of the market share in Colombia, to ensure that the market remains dynamic.[27]
On May 13, 2023, after analyzing the "financial and technical implications" of the merger under these conditions, Avianca withdrew its plans for the acquisition of Viva Air, given the strict requirements of Aerocivil and the damage that these would have on the airline's economy.[28][29]
