– Viva successfully completes 15-month program of strategic reinforcements
– ‘Cartesian Capital Group’ joins as a minority investor alongside Irelandia
– Viva Group increased its market share from 15% to 24%, solidifying its position as a top two airline in Colombia
MEDELLÍN, Colombia–(BUSINESS WIRE)–Following the deepest crisis in the global aviation industry’s history, Viva remains one of the few South American carriers to avoid bankruptcy, demonstrating the firm’s resiliency in one of the most difficult of circumstances. Viva is well positioned to let customers fly more and pay less, despite Colombia imposing one of the longest airspace shutdowns in the world. With the partnership and support of our suppliers, lessors, and staff, we have further reduced unit costs to grow and make flying Viva even more compelling and affordable for our customers. Viva is now the second largest carrier in Colombia with a market share of 24%, while leading the industry in on-time performance and becoming the first airline certified in biosafety protocols in Colombia and Peru. To further support Viva’s growth and expansion, Cartesian Capital Group has become a minority equity investor in the Viva Group alongside pioneering ULCC developer, Irelandia Aviation.
“Viva found opportunities in challenging times, and through the crisis, adapted to new ways of managing this complex business. With the commitment of our employees, evolution of our strategies, and support of our suppliers and lessors, today we can proudly say that we have solidified our position as ‘the’ low-cost provider of air travel to, from, and within Colombia and Peru. I’d like to thank all of the management team and Viva staff, along with all of our suppliers, lessors, government agencies, and banks for their continued support,” said Felix Antelo, President and CEO of Viva. “We are also excited to announce the addition of Cartesian as a minority equity partner in Viva Latin America. Their investment is a timely vote of confidence in our work, business, and future.”
Viva’s restructuring is a successful business case study for the region and the industry. After nearly six months with no commercial flights in both Colombia and Peru, Viva undertook tremendous efforts to preserve its financial base, lower its unit costs, accelerate the modernization of its fleet, and maintain its highly skilled workforce to resume flying on the first day commercial flying was restored in Colombia and Peru. Unlike Viva’s competitors, the firm’s restructuring was conducted completely in the free market without the artificial and unsustainable support of the legal code and the courts.
Over 200 supplier contracts, including all aircraft leases, were reformed in order to reduce overall costs and retime payments to align obligations to the reality of no commercial flights in Colombia. These steps also significantly reduced airport capacity for the coming months.
Cartesian Capital Group, a global private equity firm, has successfully sponsored the development of dozens of transnational companies, including airlines such as Gol in Brazil and Flybondi in Argentina. Cartesian first partnered with Viva to provide USD $50 million of financing in May 2019 and has deepened its relationship by investing in a minority equity stake in Viva Group. Irelandia Aviation, the world’s premier low-cost airline developer, will remain as majority shareholder.
“Through an unprecedented crisis, Viva has demonstrated deep resilience,” noted Peter Yu, Managing Partner at Cartesian. “Felix and the entire team have consistently shown the nimbleness, creativity, and tenacity that makes Viva a truly world-class carrier. We look forward to the group’s continued growth and success.”
Irelandia, majority owner of Viva, remarked how delighted they are to strengthen the relationship with Cartesian in the Viva Group. “Cartesian has been a valuable partner since 2019, and this is a tremendous vote of confidence in our business model and our management team both of which have seen Viva emerge from the pandemic stronger than ever,” said John Goode, Partner at Irelandia Aviation. “We are incredibly proud of Felix and everyone that make up the Viva family for their commitment and dedication they have shown in steering the company through the most difficult crisis the industry has ever seen.”
Viva reaffirms the importance of the airline industry as a connectivity pillar for the region, maintains its full commitment to contribute to the economic development of the countries it serves, and continues its founding philosophy of inclusion. Viva is the leading low-cost airline in Latin America flying to more than 31 domestic routes in Colombia and Peru, and seven international routes including Colombia, Peru, Mexico, and the United States.
Significant milestones achieved over the past year include:
– Resuming 100% of pre-covid operations, plus opening new international routes to Mexico (Cancun and Mexico City) and the United States (Orlando).
– Increasing its market share from 15% to 24%, solidifying itself as the second most important airline in Colombia.
– Becoming the first airline in Colombia and Peru to certify its biosafety protocols.
– Launching the new Viva brand, including a new website (www.vivaair.com), new products and services, new colors, and the new ‘boomerang’ livery.
– Opening HUB Medellín, offering convenient flight schedules designed for quick, convenient connections between North America and South America.
– First restoring full pre-Covid employment and then growing its staff.
– Operating more than 200 special repatriation flights to bring families home to Colombia and Perú during airspace shutdown.
– Building Colombia’s Newest Fleet:
- Modernization of its fleet, receiving Viva’s first Airbus A320 NEO in October 2020 with a total of 8 NEOs delivered to date. All NEOs include Viva’s new brand image and ‘boomerang’ livery and form one of the youngest, most fuel-efficient fleets in South America.
- Aggressive growth with the delivery of 10 more NEOs over the next 15 months for a total of 18 NEOs expected by December 2022 along with 10 modern A320 CEOs.
This performance reflects the fundamental strength of the Viva business model, which continues to deliver the lowest fares and highest customer service during the most difficult year in aviation history.
Viva, the leading low-cost airline in Latin America, flies to more than 23 destinations in Latin America, including seven international routes and multiple destinations in Peru, Mexico, and the U.S. Viva is transforming air travel in the region and beyond with its low-cost low-fare model, purchase of new Airbus A320 NEO aircraft, industry leading on-time performance, and certification under the World Travel & Tourism Council’s ‘SafeTravels’ health and hygiene global standardized protocols based on the World Health Organization and Centers for Disease Control guidelines. As part of its strategic plan to expand and launch service on more new routes within the region and internationally, the airline has purchased 50 new Airbus 320 aircraft that started arriving in 2018, including 15 Airbus A320ceos and 35 A320neos.
Irelandia is the world’s premier low-cost airline developer led by Declan Ryan, one of the founders of Ryanair. They initiate, develop, and deliver successful low-cost carriers (LCCs) in partnership with airline management and investors. They pioneered the LCC model in Europe and have developed LCCs in Asia, Australia, North America, and Latin America.
About Cartesian Capital Group
Cartesian Capital Group, LLC is a leading global private equity firm with a demonstrated ability to grow companies internationally. With historic funds comprising $3 billion in capital commitments, Cartesian’s team has helped to build 50 companies operating across 30 different countries.
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