Chilean airline JetSmart signed a letter of understanding with the intention of buying Ultra Air
Another great business is cooking in the Colombian air market. The Chilean airline JetSmart announced that it is evaluating the possibility of buying 100% of the shares of the Colombian low-cost airline Ultra Air, founded by the Mexican William Shaw, who also founded Viva Air.
JetSmart announced in a statement that it signed a letter of understanding with Ultra Air on Thursday, which begins a due diligence process “that will allow JetSmart to know the technical and financial information that this type of negotiation requires.” The process would be completed in the following 30 days. After that period and in the event that the result is positive, JetSmart and Ultra Air will proceed with the submission of said purchase agreement, to the review and approval of the authorities, as established by the regulations for this type of transaction.
The company also confirmed that “during the due diligence process, Ultra Air will continue to operate under the administrative, operational and financial parameters of the current administration, without JetSmart having any responsibility or interference in the direction, operation, services and/or Ultra Air’s finances”.
“We believe in the potential of the Colombian market and we are determined to contribute and add to the development of tourism and employment in the country. We have seen the operational and commercial qualities of Ultra Air and have reached an agreement on the terms of the purchase of the airline. We hope to advance efficiently in the due diligence and work closely with the authorities in charge of the respective approvals”, said Estuardo Ortiz, president and CEO of JetSmart.
For his part, the president and CEO of Ultra Air, William Shaw, highlighted that after a year of successful operation in the country “it is very satisfying to register the purchase interest of an airline such as JetSmart, whose development and growth trajectory denotes seriousness and reliability.
While we advance in this stage of exploration and negotiation, Colombian travelers will be able to continue enjoying our friendly service in a reliable manner and at an ultra-low cost.”
The process takes place within the framework of the process carried out by Avianca and Viva Air, which is waiting for the National Government to define the integration of both airlines.
Last February JetSmart announced that it was interested in acquiring Viva Air, an airline that ceased operations last month and is now being investigated for fraud by the Colombian authorities for having sold tickets normally hours before canceling its flights, stranding thousands of passengers from Mexico to Argentina.
To date, JetSmart has become the fastest growing airline in South America and currently has a fleet of 23 aircraft and a firm order for Airbus A320 and A321 that will see it exceed 124 aircraft by 2029. In addition, it has operations in seven countries: Chile, Argentina, Brazil, Colombia, Uruguay, Peru and Paraguay, with more than 79 routes throughout South America, and has transported more than 19 million passengers.