Colombia’s civil aviation authority on Tuesday objected to a potential merger between airline Avianca, Colombia’s flag carrier, and budget airline Viva, saying the transaction represented a risk to competition and customer well-being.
Avianca and Viva signed a deal to merge into one group and unify their economic rights in April as part of a strategy to strengthen both airlines after the global aviation industry was battered by the coronavirus pandemic.
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If the merger were to complete, the combined group would control 100% of the services offered on 16 routes, the civil aviation authority said.
Potential competitors would face new challenges for growth or expansion into markets affected by the bigger barriers to entry resulting from the control that the new entity would hold following the merger, the authority added.
