Brazilian airline Gol receives $200 mln from American Airlines

Thursday, September 16, 2021

Brazilian airline Gol announced that an exclusive three-year codeshare agreement with American Airlines (AAL.O), sending shares higher.

Gol Airlines said it will receive a $200 million equity investment as part of the agreement, according to a securities filing on Wednesday, making its preferred shares jump about 5% in early trading in Sao Paulo, outperforming the broader Bovespa index (BVSP), which fell 0.5%.

Gol Airlines said the new agreement builds on a previous codeshare arrangement between the two companies and will increase options for Gol travellers on South American and North American routes.

American Airlines’ investment in Gol is expected to happen via a sale of 22.2 million recently issued preferred shares by the Brazilian airline, taking the U.S. firm’s stake in Gol to 5.2%.

Gol Chief Executive Officer Paulo Kakinoff said that they believe it will further strengthen Gol’s presence on international markets, accelerate their long-term growth and maximise value for their shareholders.

Analysts at J.P. Morgan said in a market report that they welcome the additional liquidity provided by American Airlines’ investment in Gol, as it should further enhance the Brazilian company’s financial flexibility, even though they remain cautious with the airline industry in Latin America.

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