AEROMEXICO ANNOUNCES AGGRESSIVE EXPANSION PLAN AND INVESTMENT OF OVER $1.3 BILLION DOLLARS
- The majority of approximately $1.3 billion dollars investment will come from the company’s own resources as well as an increase of capital.
- The airline will acquire a fleet of 20 new planes, and will invest in technological advances aimed at improving customer service, as well as new facilities to optimize the operations of the company at Mexico City’s International Airport.
- The company will continue to expand its routes, incorporating new destinations in Mexico and abroad.
Mexico, D.F., March 31st, 2011- Aeromexico, Mexico’s global airline, announced today that it will invest approximately $1.3 billion dollars in the purchase of 20 new aircrafts. These investments will be acquired through a mix of fresh capital, reinvested earnings and internal resources.
Part of the capital addition will be made through an initial public primary offering. The placement will be made through the Mexican Stock Market among domestic investors. The current group of Mexican investors will continue to have stock control, as well as administrative and operational control. Today, the company made public its intent for an IPO placement.
To complement these investments, the airline will obtain financing under favorable conditions with international institutions. An example of this is the line of credit for more than $300 million dollars recently provided by the Bank for Foreign Trade of Brazil.
The investment amounts announced today will add up to the more than $500 million dollars that shareholders of Grupo Aeromexico had previously invested in the acquisition and capitalization of companies within the Aeromexico group.
Andres Conesa, CEO of Aeromexico Group, said in a press conference today, "The strategy adopted in recent years has allowed us to consolidate our position as the flagship airline of Mexico and with this new stage of financing, we will deepen the structural basis and sustained growth of the group.”
Other investments planned over the next two years include changing the current Sabre operating system, the use of new technologies to provide better service to passengers, a new cargo terminal at Mexico City’s International Airport, as well as new hangar facilities and platforms to improve the operation of the airline at the airport.
In recent years, and particularly since its acquisition from an important group of Mexican businessmen, Grupo Aeromexico has established a business model that combines responsible administration with optimization of expenditures, an increase in revenues, the management integration of airlines comprised by the group and the restructuring of fleet leases.
With the operation of the recently announced new routes and frequencies, Grupo Aeromexico consolidates its leadership in the domestic market; increasing its market share by 10 points over the last year to achieve a market share of 43 percent in the domestic market and 21 percent in the international market for flights from Mexico, in collaboration with SkyTeam commercial partners.
The purchase of 20 aircrafts - ten Embraer 190s and ten next generation Boeing 737s - will bring important savings in leasing, maintenance and fuel costs. At the same time, this initiative will reduce capital expenditure, thus strengthening the balance of Grupo Aeromexico.
Additionally, the airline will inaugurate new domestic routes to Huatulco, Colima and Tepic, while increasing international frequencies in the United States, such as Mexico–Miami and Mexico–San Antonio. Aeromexico will also add service to Caracas, Guatemala, Panama, Fresno and Sacramento throughout the year.
The position currently held by Aeromexico is a result of the effort and commitment of both employees and stockholders; all are focused on providing better service and assistance to clients. Aeromexico will continue working to maintain its position as the flagship airline that inspires Mexican pride everywhere in the world.
About Grupo Aeromexico
Grupo Aeromexico is comprised of four subsidiaries: Aeromexico, Mexico’s largest transcontinental airline, Aeromexico Connect, Aeromexico Travel, its charter airline, and EMA, the Group’s aircraft maintenance company. Its fleet includes Boeing 777, 767, 737, and MD80 aircraft, plus next generation Embraer 145 and 190 airplanes.
Grupo Aeromexico operates its main hub out of Terminal 2 in the Mexico City International Airport. The Group’s airlines operate over 500 daily flights to different cities in Mexico, the United States, Canada, Central and South America, and Europe and Asia.
Aeromexico is a founding member of SkyTeam, the global airline alliance comprised of the following 13 airlines: Aeroflot, Aeromexico, Air Europa, and Air France, Alitalia, China Southern, CSA Czech Airlines, Delta Air Lines, KLM Royal Dutch Airlines, Kenya Airways, Korean Air, Tarom Romanian Air Transport, and Vietnam Airlines. SkyTeam offers all partner airline passengers a large global network with more destinations and frequencies, and improved connectivity. Passengers can accrue and redeem miles with the different partners’ loyalty programs and enjoy the convenience provided at 415 airport lounges worldwide. SkyTeam offers its 385 million annual passengers more than 12,500 daily flights to 898 destinations in 169 countries. www.skyteam.com