Now Open Skies is finally approved, United raises its stake in Brazil’s Azul to 8% with a joint venture on the horizon.
United Continental has raised its stake in Brazil’s São Paulo-Viracopos-based Azul Airlines to 8% after buying shares from China’s Hainan Airlines, a subsidiary of HNA Group.
United initially made a small investment in Azul in 2015 and has now set a basis for greater cooperation, ATW reports.
United continues “to look for new ways to provide more connectivity for our customers,” explains Andrew Levy United’s chief financial officer.
“Following our initial investment in 2015, connecting traffic between our airlines is at an all-time high, significantly benefiting our customers traveling between the US and Brazil.”
Azul was founded in 2008 by Brazilian-American entrepreneur David G Neeleman, who has also founded the airlines Morris Air, Westjet and JetBlue and is also now the co-owner of TAP Air Portugal.
The deal comes just weeks after Brazil’s government approved an Open Skies deal negotiated with the US in 2010 – a move that may also be of interest to airlines like Norwegian, which is making inroads into South America.
Open Skies is expected to expand connectivity between the two countries. Azul has already said it is interested in closer ties with United, for example in the form of a joint venture.
Hainan Airlines bought a 23.7% stake in Azul in 2016. This reduced to 21.6% before United’s purchase, something that Hainan says will now cut its stake to 17.3%. Its parent company HNA has recently been tackling an increasing debt problem by selling off assets.