=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SFGate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2004/03/18/f= inancial1255EST0128.DTL --------------------------------------------------------------------- Thursday, March 18, 2004 (AP) Brazil's Grupo Sinergy to buy Colombia's Avianca Airlines MIKE ESTERL, Dow Jones Newswires (03-18) 09:55 PST (AP) -- NEW YORK (Dow Jones/AP) -- Brazilian conglomerate Grupo Sinergy has agre= ed to take a 75 percent stake in Colombia's troubled flagship airline Avianca, the airline's two controlling shareholders said Thursday. Avianca, which is in bankruptcy proceedings in a U.S. court, will receive a capital injection of $64 million in the transaction, according to the shareholders, Colombia's Valores Bavaria SA and the National Federation of Coffee Growers. Under the terms of the transaction, Valores Bavaria, a leading Colombian conglomerate, will hand its 50 percent stake in Avianca over to Grupo Sinergy. The National Federation of Coffee Growers initially will hand half of its 50 percent stake over to Grupo Sinergy. It will keep its remaining 25 percent stake for three years, after which time it can exercise the right to sell the holding to Grupo Sinergy. Valores Bavaria and the National Federation of Coffee Growers said they agreed to the sale in order to focus on their core businesses. They didn't provide financial details of the agreement, beyond the $64 million investment in Avianca. Avianca is Colombia's largest airline and the oldest in the Western Hemisphere. It was founded in 1919 and began flying international routes in the 1920s, according to the company's Web site. Its planes continue to fly today, but its finances have been in tatters for years. The Bogota-based company filed a bankruptcy petition in March 2003, listing more than $100 million in assets and debts each. Avianca is scheduled to submit a financial restructuring plan in a New York bankruptcy court on March 26 after receiving five extensions. Last week it reported a net loss of 309.7 billion pesos ($116.2 million) for 2003, widening from a loss of 102.5 billion pesos in 2002. Operating revenue totaled 1.56 trillion pesos ($585.7 million) last year, up 11 percent from 2002. Grupo Sinergy is headed by Brazilian businessman German Efromovich and is active in the petroleum, naval, electricity generation, telecommunications and aviation sectors. It controls oil exploration company Maritima Petroleo e Energia Ltda., which has operations in nine countries and boasts more than 5,000 employees and annual revenue of $300 million. The conglomerate provides maritime platforms for the oil industry in Brazil, Ecuador and Colombia. ---------------------------------------------------------------------- Copyright 2004 AP