American Airlines and Gol Deepen Partnership
Two years ago, American Airlines' (NASDAQ: AAL) plan to form a joint venture with South American airline giant LATAM Airlines fell apart after Chile's Supreme Court ruled that the deal would be anticompetitive. Within months, the U.S. airline giant found a new partner in South America: Gol Linhas Aereas (NYSE: GOL).
Last week, American Airlines announced that it plans to invest $200 million in Gol's preferred shares to take a 5.2% economic interest in the Brazilian airline. The two airlines also plan to deepen their cooperation. Let's take a look at why this move is so important for American's long-term health.
Thanks to its hub in Miami, American Airlines has had a significantly larger presence in South America -- especially in Brazil -- than any other U.S. airline for many years. Around the time that it merged with US Airways in late 2013, American Airlines flew to nine destinations in Brazil and planned to keep growing there.
Source Fool.com
