Future of Mexicana, Aeromexico Remains Blurry as No Buyout Plan Looms Ahead

The fate of Mexicana de Aviacion and Aeromexico is still shaky as long as both companies don’t come up with a buyout plan, the Mexican Institute of Bank Saving Protection (IPAB is the Spanish acronym) reported this week.

IPAB Secretary-General Mario Beauregard explained before the House Communications Commission that Cintra, the top administrative body of the nation’s major airlines, is currently working on the revamping of both carriers before selling them out.

However, IPAB will seek favorable conditions to prevent the future bailout of cash-strapped companies off public finances, a situation that has occurred a couple of times in the past.

Last October, Cintra huddled with the Federal Competition Committee to tackle the reshuffling of its airlines in an effort to put them on sale in two different packages, one linked to Aerolitoral and Aerocaribe companies, and the other made up of Aeromexico and Mexicana de Aviacion. Either way, the sale deadline would be up before 2006.

Official sources have noted Aeromexico and Mexicana de Aviacion should be negotiated separately to both avoid monopoly in the industry and offer national passengers the best airfares they can possibly come up with in the competitive process.