Air Transport World

Varig: America/Caribbean)(sales, profits )

Brazil's flag carrier has spent the past year attempting to reorganize through bankruptcy, but its survival remained an open question at this writing. Certainly it no longer will exist in its former structure or at its former size. Two of its subsidiaries were sold off late last year with the sales completed in January. VEM-Varig Engineering & Maintenance went to Aero-LB, a consortium led by TAP Portugal. VarigLog, its cargo and logistics subsidiary, also went to TAP, which then sold it to Volo Brasil, a consortium headed by US-based Matlin Patterson, a private equity fund.

VarigLog in turn offered $400 million to buy its former parent. But, in what in hindsight looks like a monumental misjudgment, Varig's creditors and Brazilian government officials decided to auction off its remaining assets, namely its aircraft and routes. …

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