12 December 2012

Delta to acquire 49% stake in Virgin Atlantic for $360 million

- 49% stake currently held by Singapore Airlines 
- Expanded Trans-Atlantic network and enhanced customer benefits 

Atlanta and London - 11 December 2012 (PRNewswire) - Delta Air Lines and Virgin Atlantic Airways Ltd. have reached an agreement for a new joint venture that will create an expanded trans-Atlantic network and enhance competition between the U.K. and North America, offering greater benefits for customers traveling on those routes. 

As part of this joint venture agreement, Delta will invest $360 million in Virgin Atlantic, acquiring a 49 percent stake currently held by Singapore Airlines. Virgin Group and Sir Richard Branson will retain the majority 51 percent stake and Virgin Atlantic Airways will retain its brand and operating certificate. 

The airlines will file an application with the U.S. Department of Transportation for antitrust immunity, which will allow a closer relationship and coordination on schedules and operations. The transaction also will be reviewed by the U.S. Department of Justice and the European Union's competition regulator and other relevant authorities. The share purchase and the joint venture are expected to be implemented by the end of 2013. 

"Our new partnership with Virgin Atlantic will strengthen both airlines and provide a more effective competitor between North America and the U.K., particularly on the New York-London route, which is the largest airline route between the U.S. and Europe," said Delta CEO Richard Anderson. 

Steve Ridgway, Virgin Atlantic Chief Executive, added: "Consumers will reap the rewards of this partnership between two great airline brands on services from the UK to the USA, Canada and Mexico through a shared ethos in the highest standards of customer service. This joint venture will deliver much more effective competition at Heathrow.” 

The partnership allows both carriers to offer a greatly expanded network at Heathrow and to overcome slot constraints, which have limited the growth and competitive capability of both airlines. The two carriers will operate a total of 31 peak-day round-trip flights between the U.K. and North America, 23 of which operate at London-Heathrow. The enlarged network will benefit customers of both carriers by providing greater access to a broader network, improved connectivity and convenient booking options. 

Corporate and travel agency customers of both airlines also will benefit from an aligned sales effort on both sides of the Atlantic. 

Delta Air Lines serves more than 160 million customers each year. Delta and the Delta Connection carriers offer service to nearly 313 destinations in 58 countries on six continents. Headquartered in Atlanta, Delta employs 80,000 employees worldwide and operates a mainline fleet of more than 700 aircraft. 

Virgin Atlantic flies to 34 destinations worldwide, including locations across North America, the Caribbean, Africa, the Far East and Australia. Some of its most recent additions to its flying network include Cancun, Vancouver and Mumbai. 

Source: Delta Air Lines