Skift Travel News Blog

Marriott International said on Friday it had received an okay from Mexico’s competition watchdog for its acquisition of the City Express brand portfolio from Hoteles City Express. The news clears the path for the $100 million deal, first announced in October, and which may now close before June.

The hotel group seeks entry into the affordable midscale segment by adding its 31st brand, City Express.

“We expect to grow that brand aggressively in the Latin America and Caribbean region,” said Anthony Capuano, president and CEO of Marriott, in an earnings call with analysts in February. “And, as we move toward closing that transaction, we are evaluating the applicability of that brand in other markets around the world.”

The deal includes 152 hotels with about 17,000 rooms. It will boost Marriott’s footprint in the Caribbean and Latin America by 45 percent, to 486 properties. 

City Hotels said its hotel occupancy in December 2022 stood at 104.9 percent of the comparable pre-pandemic 2019 level.

“We’re thrilled about entering the appealing midscale lodging category and offering customers even more choice in the destinations they seek for both business and leisure stays,” said Brian King, president, Caribbean and Latin America  at Marriott International.

Mexican regional airline Aeromar closed its doors on Wednesday after it failed to reach a deal with creditors or secure new capital.

The airline was a small player in Mexico’s aviation market, flying less than 1 percent of the country’s domestic seats in February, according to Diio by Cirium schedules. However, flying smaller ATR turboprops, it lacked competition on many of its routes. For example, from Mexico City Aeromar was the only airline serving Colima, Ciudad Victoria, Ixtepec, McAllen, Piedras Negras, and Tepic, Diio data show.

Aeromexico, Viva Aerobus, and Volaris — the three airlines that dominate Mexico’s domestic market — have all offered to assist travelers stranded by Aeromar’s collapse.

Aeromar said in a statement that it planned to liquidate its assets, which include 10 aircraft.

The airline’s collapse is the latest in a volatile recovery for airlines in Latin America. Three of the region’s largest — Aeromexico, Avianca, and Latam Airlines — all restructured under U.S. Chapter 11 protection during the pandemic. Mexico’s fourth largest airline, InterJet, collapsed in December 2020. And Colombia’s Viva Air filed for the local equivalent of bankruptcy earlier in February; the airline may also be the subject of a bidding war between Avianca, Latam, and Chile’s JetSmart.

Struggling Latin American discounter Viva Air has entered the local equivalent to bankruptcy protection under Colombian law, as it works to restructure debt while awaiting a decision on its proposed merger with Avianca.

The Medellin-based airline said Friday that it had filed for Colombia’s Business Recovery Process, or known locally as PRE, to restructure its debt following challenges related to the Covid-19 pandemic and the delays in approvals to its combination with Avianca.

“The company has not been able to access capital during the last nine months since it has not yet been able to finalize its merger with another airline, which is still pending authorization from the national government,” Viva told Reuters.

Viva flights continue to operate as normal as the carrier begins restructuring, flight tracking website FlightRadar24 shows.

Viva CEO Felix Antelo told Airline Weekly in October that the merger was necessary for the airline’s continued survival. He noted that the deal would provide the budget carrier with the “financial muscle” to expand its low-fare model to more travelers.

Avianca and Viva announced plans to merge in August, after the former took a controlling stake in the latter earlier in 2022. However, Colombian regulator, Aerocivil, blocked the combination on competitive grounds in November. Aerocivil reopened the case in January after Avianca and Viva — Colombia’s first and third largest airlines — offered concessions to promote competition in Colombia.

And Chile-based budget airline JetSmart made a competing offer earlier in February to take full control of Viva.

Aerocivil tweeted Friday that it was advancing with “technical and legal rigor” its evaluation of the proposed Avianca and Viva merger, and anticipated a “prompt” decision on the matter.