Reuters: Mergers News: UPDATE 1-Chile's LAN sees TAM takeover by early June

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UPDATE 1-Chile's LAN sees TAM takeover by early June Apr 26th 2012, 15:43 Thu Apr 26, 2012 11:43am EDT * Takeover of TAM seen complete in first week of June * LAN to spend $1.7 bln on aircraft in 2012 * LAN Q1 net profit seen falling 22.3 pct yr/yr By Felipe Iturrieta SANTIAGO, April 26 (Reuters) - Chilean airline LAN said on Thursday it expects to complete its takeover of Brazil's TAM by the first week of June, creating one of the world's biggest airlines. LAN, which had previously hoped to complete the deal by mid-May, expects to launch a share swap under the merger process in the next couple of weeks, Chief Financial Officer Alejandro de la Fuente said at a shareholder' meeting. Regulators in Chile and Brazil have already approved the transaction. "The process is practically ready ... The (share swap) should be launched next week or the following one, and with that the merger should be complete in the first week of June," de la Fuente said. He added that LAN plans to invest $1.7 billion in aircraft in 2012, part of a wider fleet investment plan. LAN said in late January it would spend $4.73 billion between 2012 and 2014 on fleet renewal. The Chilean carrier's 2011 full-year net profit fell nearly 24 percent to $320 million, and fourth-quarter profit plunged 31.6 percent to $112.5 million on flight disruptions due to an ash cloud spewed by an erupting volcano in Chile, restructuring costs in Colombia and higher fuel prices. LAN's first-quarter net profit is expected to fall 22.3 percent on the year to $75.5 million, as rising fuel prices and the Colombia costs continue to be a drag, according to analysts polled by Reuters. LAN, headquartered in Santiago, has domestic passenger operations in Argentina, Colombia, Chile, Ecuador and Peru and cargo operations in Brazil and Mexico. Link this Share this Digg this Email Reprints

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