LAN Becomes Majority Holder of Argentine Affiliate

Chile’s flag carrier LAN airlines increased the share of its Argentine affiliate to 70 percent, following 2006 reforms to the Argentine Aeronautical code authorizing foreigners to have a majority stake in commercial airlines, reports the Buenos Aires press.

LAN Argentina currently holds 15 percent of the country’s domestic flights market while Aerolineas Argentina, currently under control of the Spanish tourism group Marsans is the dominant airline with an 80 percent share.

LAN, which begun operating in Argentina as a local company in June 2005 has since become Aerolineas main competitor in the country. Local associates of LAN, Jorge Perez Alati and Manuel Benitez who originally held 51 percent of the company have fallen back to 30 percent following several capital increases.

With Aerolineas Argentinas and LAN dominating 90 percent of the country’s domestic flights, the Argentine commercial air industry is now in foreign hands. Only two local companies operate in the five million travelers’ annual market, with a 5 percent share.

One of the biggest airlines in Latin America with affiliates in Ecuador, Peru and Argentina, LAN is also eyeing a foothold in the region’s biggest aviation market, Brazil.

Revenues in 2006 increased 21 percent to over $3 billion, with revenue from passenger traffic climbing 24.2 percent, and 17.8 percent from cargo transport.