Caribbean Merger

AFTER MONTHS of negotiations, Caribbean Airlines has taken control of financially troubled Air Jamaica.  An agreement was reached in late April and over the following months Air Jamaica will be gradually closed down and its assets transferred to the Trinidad & Tobago-based operator.  In return, the Government of Jamaica will take a 16% stake in Caribbean Airlines and will assume responsibility for the costs associated with closure of Air Jamaica, estimated to be upwards of $750 million.
According to Government officials, all routes from Kingston and Montego Bay to the main US gateways such as Fort Lauderdale, New York and Philadelphia will be retained by Caribbean Airlines.  Local sources say Caribbean Airlines is now setting its sights on regional carrier LIAT.  The two companies agreed to a closer co-operation in January this year, but it is now believed that a takeover deal could be agreed in the coming months to further consolidate the airline industry in the region.