Chile's LAN Airlines said Friday it has completed its takeover of Brazilian airline TAM, creating Latin America's biggest airline, LATAM Airlines Group.
The deal, which began in May, concluded after 99.9 percent of TAM shareholders exchanged their shares of the company for those of LAN, at a rate of 0.9 shares of the Chilean airline for each share of the Brazilian airline in the last step to create the aerospace giant.
"The creation of this group of airlines is an opportunity to take South America to the world and to allow us to position ourselves to operate in an increasingly competitive environment due to the continuing consolidation of the global airline industry," said LATAM executive vice president and CEO Enrique Cueto said in a statement.
Through the airlines that comprise it, LATAM "will offer its passengers more flights to more destinations than any other airline group in South America, initially reaching about 150 destinations in 22 countries and transporting cargo to 169 destinations in 27 countries," the company said.
Cueto said that each airline in LATAM will keep its current headquarters, with LAN in Santiago and TAM in Sao Paulo. The companies will also continue to operate under their existing brands in the short term.
"This is the beginning of a long journey and the benefits to our customers will be added gradually as the integration of our companies' progresses," Cueto added.
The merger, first announced in August 2010, creates an aviation behemoth valued at $14.5 billion and set to represent six percent of global air transport.