Delta Buys Singapore Airlines’ Share of Virgin Atlantic

There have been rumors around for some time that Delta was in discussion with Singapore Airlines to buy its share of Virgin Atlantic. Today, the deal was announced. Delta is buying the 49% share of Virgin Atlantic for $360 million. Singapore Airlines paid $968 million for its share of Virgin Atlantic back in 1998.

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The deal is expected to close at the end of 2013 after US and European Union competition regulators have reviewed the deal.  The airlines are planning to form a transatlantic joint venture for flights between the United Kingdom. Most likely nothing is going to happen interim to the frequent flyer programs of both airlines.

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There has also been speculation on the UK press that Air France-KLM would buy part of the 51% share that Sir Richard Branson owns/controls.

Sir Richard has also been very vocal lately that the airline is likely to join an alliance soon. If this purchase by Delta goes through and Air France-KLM buys part of the share owned by Sir Richard, it is very unlikely that the alliance of choice would be anything else than SkyTeam.

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Currently, Virgin Atlantic’s Flying Club doesn’t have a single SkyTeam airline on its partner folio. It has seven Star Alliance carriers (Air China, Air New Zealand, ANA, SAS, Singapore Airlines, South African Airways & US Airways) and one Oneworld carrier Malaysia Airlines (joining Oneworld in February of 2013).

Conclusion

From my personal perspective, I would rather see Virgin Atlantic joining Star Alliance than SkyTeam that I consider being a tertiary alliance compared to Star and Oneworld.

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