Brazilian airlines TAM and Varig have delayed signing an agreement on their planned merger following a dispute over maintenance facilities. Late last week local government officials requested additional time to evaluate the plan to create a new airline combining the two carriers, which had been scheduled to sign a binding agreement last week. Varig's majority shareholder, FRBPar, had argued for a delay in the merger as it seeks to resolve a dispute over Varig's maintenance division, Varig Engenharia e Manutençã, which FRBPar wants spun off into a separate entity.

Source: Flight International