Air France-KLM will invest $100 million in Brazilian low-cost carrier Gol, as part of a long-term partnership that will cover joint sales and expanded codesharing between the two airlines.
The deal, subject to anti-trust approvals, follows a similar arrangement forged between Gol and Delta Air Lines, which is in SkyTeam with Air France-KLM.
Of the $100 million investment, $52 million will be invested in Gol preferred shares equivalent to 1.5% of Gol's total capital. The shares, priced at $12.23 per share, have no voting rights.
Air France-KLM will fund $23 million in commercial agreements to develop sales tools and marketing efforts, and another $25 million over two years as a reward for synergies reached from the deal, says Gol's chief executive Paulo Kakinoff today.
"The agreement signed today with Air France-KLM, one of the largest companies in Europe, confirms Gol's strategy of seeking strong partnerships, and expanding the supply of services and destinations to customers of both companies. Europe is one of the most popular destinations for Brazilians, and this alliance will bring unique benefits and opportunities," he says.
Air France-KLM chief executive Alexandre de Juniac says the deal will boost the carrier's position in Brazil, which will benefit from increased travel demand with the upcoming World Cup and Olympic Games. KLM president and chief executive Camiel Eurlings will become a member of the alliance committee on Gol's board of directors.
The two airlines will expand its codesharing partnership to cover flights operated by Air France and KLM between Europe and Brazil, and domestic Brazil flights operated by Gol.
Air France will launch new thrice weekly service to Brasilia from 31 March. It also plans to operate service between Paris and Sao Paulo, using Airbus A380 aircraft, once it receives airport approvals.
Despite aligning itself with another SkyTeam carrier, Gol says it is not keen on joining a global airline alliance. "The transaction does not envisage Gol’s adherence to a global alliance, and it is aligned with the company's goal of seeking out long-term strategic partnerships and strengthening its capital structure, with a focus on creating value for its shareholders," says the airline.