Brazil’s Administrative Council for Economic Defense (CADE) has unconditionally approved American Airlines’ planned US$100 million investment in Azul, clearing the US carrier to acquire a minority stake of around 8% in the Brazilian airline, according to The Rio Times.
CADE’s technical staff issued a favourable opinion on July 31, concluding that the transaction poses no competition concerns on routes between Brazil and the US. The decision will become final if no commissioner challenges or reviews the ruling within 15 days of its publication in Brazil’s official gazette, the Diário Oficial da União (DOU).
The investment forms part of Azul’s Chapter 11 restructuring. In February, the airline announced amended equity investment agreements under which both American Airlines and United Airlines separately committed US$100 million, providing a combined US$200 million in fresh capital.
The arrangement will leave the two largest US airlines each holding an approximately 8% stake in Azul. According to The Rio Times, the approvals also indicate CADE’s willingness to permit minority foreign investments in Brazilian airlines, provided they do not confer disproportionate governance rights or raise competition concerns.
