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Avianca Airline Group seeks investors to maintain position in a changing Latin American landscape

Analysis

The decision to merge by Avianca and Grupo TACA in 2009 is what kickstarted consolidation in Latin America. The merger of the two companies, now operating as Avianca Holdings, arguably triggered the combination of LAN and TAM to create LATAM - the region's most powerful grouping of airlines.

As Avianca and TACA and LAN and TAM were integrating their respective operations, other South American airlines garnered investment from foreign airlines - SkyTeam partners Air France-KLM and Delta invested in the independent Gol, and United and HNA Group took stakes in Azul.

Now Avianca is seeking a strategic investing partner, and many airlines are reportedly interested in obtaining a stake in the company. The investment will allow Avianca to weather difficult near term economic conditions and remain on equal footing with its competitors, while the company's suitor obtains strategic positioning in one of most important growth markets - Latin America - for the next decade and beyond.

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