Air Transport World

Varig and TAM. (News Briefs: Latin America/Caribbean Report).(will combine services)(Brief Article)

Varig and TAM will combine services in a new corporate holding structure under an agreement in principle reached between the two with government encouragement. Details of how the new company would be structured were not revealed. A merger would combine Varig's mostly Boeing fleet of 116 aircraft with TAM's primarily Airbus fleet of 102 airplanes.

Local observers expressed skepticism that the deal will come to fruition in light of the complex issues involved. These include lack officer commonality, competition issues-together the carriers would enjoy a 70% marker share--potential job losses and ownership issues. …

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