February 19, 2019 / 12:38 PM / 8 months ago

With new decree, LATAM Airlines Brazil officially passes to Chilean hands

SAO PAULO, Feb 19 (Reuters) - Chile’s LATAM Airlines Group SA has asked Brazil’s antitrust regulator Cade to boost its voting stake in LATAM Airlines Brazil to 51 percent, formalizing a controlling interest in Brazil’s No. 2 airline that for years it was unable to achieve because of local restrictions.

In December, Brazil’s then-President Michel Temer signed an executive order allowing foreigners, for the first time, to own up to 100 percent of domestic Brazilian airlines. That temporary measure will expire by June if not ratified by Congress.

While the move is the first concrete action in Brazil following Temer’s executive order, it will have little practical effect. In its financial statements, LATAM Brazil already says the Chilean company is its “indirect controller.” In 2012, Chile’s Lan merged with Brazil’s Tam, resulting in the creation of LATAM.

In a statement, LATAM Brazil said the change would not affect airline operations.

“This move will create administrative efficiencies,” the statement said. LATAM Brazil “will continue to be managed the way it has been so far.”

Brazil’s Cade did not immediately respond to a request for comment. The news was first reported by Brazilian newspaper Valor Economico. (Reporting by Marcelo Rochabrun; Editing by Bernadette Baum)

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