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Copa joins joint venture talks with Avianca and United

Copa Airlines has been added to talks for a potential joint business involving Avianca and United Airlines, strengthening a possible partnership that would be better positioned to compete with similar tie-ups emerging in Latin America.

Avianca says in a stock exchange filing that it has been in discussions with United and Copa on the "possibility of establishing a three-way joint business agreement" which would include their combined networks between the USA and Latin America. All three airlines are members of the Star Alliance.

"At this point we can provide no assurances as to whether or when the parties will finalise the agreement," says Avianca.

Copa and United have been long-time partners, going back to the days when Continental Airlines held a share in the Panamanian airline. In 2016, Copa and United renewed their alliance for at least five years.

Copa chief executive Pedro Heilbron declines to comment further. United echoes Avianca's statement, adding that a potential partnership with Avianca and Copa would "enhance our joint networks between the United States and Latin America".

Avianca and United have been in talks for a joint venture since early 2017, but the discussions have not yet produced a deal. Avianca's choice of United as a strategic partner - reportedly over Copa and Delta Air Lines - was not without controversy.

Avianca's biggest minority shareholder took the airline and United to court in February 2017, seeking to block the proposed partnership. The lawsuit prompted a counter lawsuit from Avianca, but both sides agreed in November 2017 to drop the legal action against each other.

Airline joint venture activity is set to heat up in Latin America in the coming years, with several such partnerships in the works. LATAM Airlines Group is pursuing deals with American Airlines and IAG, while Azul is working on a joint venture with partner TAP Portugal and has also expressed interest in a deeper partnership with United.

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