GOL signs an agreement with American Airlines, and receives a BRL 1,05 billion contribution

by '@Pedro

GOL and American Airlines

A GOL Linhas Aéreas announced the expansion of its commercial cooperation with American Airlines Group through an exclusive codeshare agreement for the next three years, which will deepen the relationship between the two airlines.

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As part of the Agreement, GOL will receive from American an investment in equity of US$200 million (R$1,05 billion).

This exclusivity allows the Agreement to exceed the of the existing codeshare partnership between GOL and American, increasing travel opportunities for its engers, as well as improving the customer experience and GOL's competitive position on the routes that connect the Americas of the South and the North.

Effective February 2020, the existing codeshare represents the largest network in the Americas and allows the Company's customers to conveniently connect to more than 30 destinations across the United States.

The partnership flights currently operate at GOL's hubs in São Paulo (GRU) and Rio de Janeiro (GIG), integrating 34 Brazilian and international route options, as is the case with Montevideo, Uruguay.

The conclusion of the Agreement and the equity investment are subject to certain conditions, including the signature and delivery of the definitive documentation and other usual conditions for transactions of this size.

 

Equity Investment in GOL

American will invest US$200 million in 22,2 million newly issued preferred shares of GOL in a capital increase, giving it a 5,2% stake in the economic interests of Companhia Brasileira at a price of US$9,00 per preferred share (“PN” or “GOLL4”), equivalent to R$47,03 per PN at the exchange rate.

The closing price of GOLL4 on 14/9/21 and the average trading price during the second half of 2019 were R$19,28 and R$35,68, respectively.

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Richard Lark, GOL's Chief Financial Officer, added: “The investment represents recognition, by a major American airline, of the Company's value as the largest airline in Brazil and supplier of the best product. In addition, the investment, when added to the R$2,7 billion of long-term capital raised in 2Q21, brings the total long-term capital raised to more than R$3,7 billion in the last six months, including more than R$2,0, XNUMX billion new capital. This additional liquidity further improves GOL's financial flexibility while minimizing dilution for shareholders.”

All holders of preferred shares of the Company, including those in the form of ADRs, will be able to exercise their preemptive rights to subscribe for a portion of the newly issued shares in proportion to their existing holdings.

It is expected that the detailed and conditions of the capital increase will be approved by GOL's Board of Directors and disclosed in a timely manner, including the final amount of the capital increase in reais, the issue price, the registration date and the periods and procedures for the exercise of preemptive rights by the Company's shareholders.

The equity investment described herein is subject to certain and conditions set forth in a letter of intent and a term of commitment signed on this date between GOL and American.

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The right to pro rata subscribe for preferred shares pursuant to the preemptive right referred to in this notice has not been ed with the United States Securities and Exchange Commission (SEC) and will not be offered or extended in the absence of registration or an applicable exemption from the registration requirements

 

Exclusive Codeshare

"The exclusive codeshare agreement between two of the Americas' leading airlines combines highly complementary networks and provides customers with a superior travel experience provided by the largest number of flights and destinations in North and South America", said GOL CEO Paulo Kakinoff. “We believe this will further strengthen GOL's presence in international markets, accelerate our long-term growth and maximize value for our shareholders. It also ratifies the confidence in the Company’s growth as the economy reopens and the demand for travel increases.”

GOL's network serves 63 destinations in Brazil and 140 internationally through codeshare agreements. The Company recently confirmed that Cancún (Mexico) and Punta Cana (Dominican Republic) will be its first international routes to reopen since the beginning of the Covid-19 pandemic.

GOL will begin operating flights on these routes in mid-November 2021. Over the past 10 years, American has transported more than 14 million engers between Brazil and the United States, representing more than double the traffic of the second largest airline American.

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The combination of the Brazilian air network and American's leadership in the US-Brazil market will maximize revenues through greater connectivity and better route options for customers.

American Airlines President Robert Isom stated: “American has long been the leading American airline to South America and our exclusive partnership with GOL solidifies this leadership position. Our long-haul network matches perfectly with GOL's strong domestic network in Brazil and, together, we will be able to offer customers flying to, within and from Brazil access to the largest network at the lowest fares, as well as the best and largest t loyalty program for frequent travelers in the Americas.”

GOL's Smiles and American's AAdvantage loyalty programs will be partners in the largest t frequent flyer program in the Americas, with superior benefits in early 2022.

This will include access for program to numerous benefits, such as priority check-in, security screening and boarding, an increased checked baggage allowance, access to VIP lounges and preferred seating on both airlines. Customers will be able to earn and redeem frequent flyer miles on either airline.

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The partnership between GOL and American also allows customers to purchase connecting flights on both companies through a single booking, in addition to creating an extremely convenient ticketing, check-in, boarding and baggage drop-off experience at the same time. throughout the entire trip.

Peter Viana

Author Peter Viana

Aerospace Engineering - Photo and video editor - Photographer - Aeroflap

Categories: Airlines, News

Tags: American Airlines, Input, codeshare, financial, GOL, Investment, usaexport

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