Delta Airlines Buys 49 Percent Stake in Virgin Atlantic
Delta Air Lines said it will buy almost half of Virgin Atlantic for $360 million as it tries to catch up to rivals in the highly lucrative New York-to-London travel market.
Delta plans to form a joint venture with Virgin Atlantic so they can sell seats on each other's flights, share the costs and profits, and set the flight schedules in ways that help both airlines. American Airlines has a similar deal with British Airways.
Since Delta would be setting fares and schedules in coordination with an airline it used to compete with, it said it will need antitrust approval from U.S. and European regulators in order to form the joint venture. Delta said the share purchase will happen with or without antitrust approval.
The deal won't add flights between the U.S. and Britain. But travel will be more seamless. Travelers would be able to buy one plane ticket on Delta and connect in New York to a Virgin Atlantic flight to London.
Travelers from Europe will also have a smoother transition onto Delta flights to locations inside the United States. Frequent flier programs for the two airlines will also be linked.
Delta is aiming to have the joint operation running by the end of 2013.