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Gol and Azul surprise the market and prepare a historic merger: Will this be the end of airline competition in Brazil? Discover the impacts of this unexpected union!

Written by Alisson Ficher
Published 14/10/2024 às 13:08
Gol and Azul plan historic merger in 2024. The Brazilian airline market may never be the same again. Impacts on competition are expected.
Gol and Azul plan historic merger in 2024. The Brazilian airline market may never be the same again. Impacts on competition are expected.

The merger between Gol and Azul promises to shake up the Brazilian airline market. What does this mean for consumers? Less competition or more efficiency?

A radical change may be about to happen in the industry aviation in Brazil.

Airlines' advice Gol e BLUE would once again be discussing a possible merger that promises to transform the country's aviation market.

According to sources, negotiations have resurfaced and could result in an announcement later this year, even if it is only a preliminary version of the agreement.

The question remains: what does this merger mean for consumers and the Brazilian aviation market?

The expectation is that, if the merger is confirmed, the regulatory procedures and approval of the Administrative Council for Economic Defense (Cade) only occur next year.

However, the government would have already been informed about the potential M&A (merger and acquisition) between the companies. This marks the resumption of talks, which were interrupted during Azul's debt renegotiation process with its creditors.

Gol in judicial recovery and Azul negotiating its debts

Goal and Blue face significant financial challenges.

While the Gol deals with a judicial recovery process in the United States, initiated in January 2024, BLUE has been working to renegotiate its debts with lessors and manufacturers.

Earlier in the week, the BLUE announced a crucial agreement with these partners to exchange part of their debt for shares in the company.

According to a statement from BLUE, lessors and manufacturers agreed to eliminate a stake equivalent to approximately R$3 billion in debt, in exchange for up to 100 million new preferred shares issued by the company.

This maneuver could be essential to stabilize Azul and facilitate merger negotiations.

Meanwhile, Gol continues to face financial difficulties.

The company reported a net loss of R$544 million in August 2024, more than double the loss recorded in July, which was R $ million 221.

The company's net debt also increased, reaching the mark of $ 28,391 billion. Even with these challenges, the Gol expects to exit the judicial recovery process in early 2025.

What does the merger mean for the consumer?

If the merger between Gol e BLUE comes to fruition, Brazilian consumers can expect significant changes in the airline industry.

The union of the country's two main airlines may result in less competition and greater market concentration.

This could lead to price increases on domestic routes and fewer flight options for passengers.

On the other hand, a stronger, more unified company can provide greater operational efficiency, better cost management and new opportunities for international expansion.

The merger could also allow both companies to face growing pressure from international airlines that have been expanding their presence in Brazil.

Expectations for the future

There are still many questions in the air about the future of Gol and BLUE and the impact of this merger.

The two companies will have to overcome significant regulatory barriers, both in Brazil and internationally, and convince the Cade and other bodies that the union will not harm consumers or the market as a whole.

Will this merger be enough to save the companies from their financial crises or will the Brazilian airline market suffer even more from this concentration of power?

What is certain is that the announcement of a possible merger could shake up the sector, bringing new dynamics to the aviation market in the country.

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Alisson Ficher

Journalist graduated in 2017 and working in the field since 2015, with six years of experience in print magazines and over 12 thousand online publications. Specialist in politics, jobs, economics, courses, among other topics. If you have any questions, want to report an error or suggest a topic on the topics covered on the site, please contact us by email: alisson.hficher@outlook.com. We do not accept resumes!

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