A Mexican consortium, aided by a private equity firm, has stepped up to buy a controlling stake in troubled airline Mexicana after financial woes pushed the carrier to the brink of collapse.
Private equity firm Advent International helped put the deal together, but the equity firm is not participating as a shareholder in the consortium, called Tenedora K, according to a statement obtained from Advent's public relations office in Mexico.
Mexicana, one of Mexico's two top airlines and a major carrier bringing tourists to Mexican beach resorts, has halted more than a dozen international routes and stopped selling tickets after requesting creditor protection in Mexico and the United States.
Tenedora K bought the 95 percent stake in Nuevo Grupo Aeronautico, which controls Mexicana as well as domestic airlines Mexicana Click and Mexicana Link, the statement said.
"Tenedora K is a company formed by a group of Mexican businessmen as a vehicle to capitalise the mentioned airlines, with the aim of rescuing them from the critical financial and operating situation they are in," the statement said.
The news that the Mexican group had stepped forward caps a week marked by speculation about how long a carrier with about USD$800 million in debt could continue to operate.
Tenedora K said the move was only a "first step" in trying to save the airline, adding that legal proceedings under Mexico's insolvency laws would continue for the time being.
The statement obtained from Advent said that among the Tenedora K shareholders were Grupo Industrial Omega and Grupo Arizan. The remaining 5 percent stake in the holding company is held by the pilots' union, it said.
On Friday, Mexican hotel operator Grupo Posadas said it had sold its 30 percent share of Nuevo Grupo Aeronautico to an unspecified buyer for a "symbolic" price. Posadas bought Mexicana in 2005 and later sold off stakes to private investors.
MEXICANA SAYS LABOUR COSTS TOO HIGH
Fernando Perfecto, head of the pilots' union, said the consortium was still deciding how much money it would invest in the airline.
He said it would be more clear by Wednesday of next week how much money Tenedora K would inject into the troubled airline. For now, he said, Mexicana had enough cash to keep the 100 daily flights it is currently operating in the air.
Mexicana chief executive Manuel Borja recently said the airline would need at least USD$100 million to continue operations.
Perfecto, who has been involved in seeking a buyer, said Borja had stepped down and had been replaced by a new executive as of Friday. He declined to name the new head of the airline.
"We are working to fast track due diligence, and the capital injection is subject to there being favourable investment conditions," Perfecto said.
Mexicana's management had said that current labour costs are too high and will ensure the airline cannot continue to operate. While unions oppose pay cuts, they have expressed willingness to discuss pay and staff cuts.
"Tenedora K stresses that this is the first step to establish conditions that could eventually allow for a restructuring process to begin, which would require agreements on labour, operation and financial issues. Without these it will not be possible to rescue the airlines," the statement said.