Mexican Regulators Put Conditions on Delta-Aeromexico Transaction
May 02 2016 - 10:10PM
Dow Jones News
MEXICO CITY—Mexican antitrust regulators said Monday that they
have conditioned approval of an enhanced partnership between Delta
Air Lines Inc. and Mexico's biggest carrier Grupo Aeromexico SAB to
the two giving up certain takeoff and landing slots at Mexico
City's international airport and eliminating duplication of
designations on cross-border routes.
The two carriers are awaiting a series of approvals for Delta to
raise its stake in Aeromexico to 49% from around 17% at
present.
The conditional authorization by the Mexican Competition
Commission comes after the Mexican Senate recently ratified a more
liberal air treaty between the U.S. and Mexico.
The airlines have also applied for U.S. antitrust immunity to
step up their joint-venture.
The commission said that under the terms proposed by the
airlines, the transaction could have hindered competition on
cross-border flights between Mexico and the U.S., while saturation
at the Mexico City airport limits access to takeoff and landing
slots for potential competing carriers.
At present, Delta exercises competitive pricing pressure on
Aeromexico for flights between Mexico and the U.S., it added.
Aside from relinquishing some takeoff and landing slots, one of
the two carriers must eliminate overlapping route designations
between Mexico and the U.S., the commission said.
Aeromexico said in a release that the two airlines are
evaluating the resolution and conditions imposed by Mexican
regulators. Regulatory clearance by the U.S. Department of
Transport is pending, Aeromexico added.
Delta and Aeromexico began code-sharing in 1994. The two signed
an expanded commercial agreement in 2011, and in 2012 Delta took a
stake in the Mexican airline.
Write to Anthony Harrup at anthony.harrup@wsj.com
(END) Dow Jones Newswires
May 02, 2016 21:55 ET (01:55 GMT)
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