Avianca Holdings considers legal action against shareholder
MIAMI - Avianca Holdings has once again fired back in the ongoing conflict with its minority shareholder Kingsland Holdings, owned by board member Roberto Kriete. Avianca will investigate the possibility of launching an action against Kriete who is actively seeking to stop a tie-up between Avianca (AV, Bogotá) and United Airlines (UA, Chicago O'Hare).
Kingsland – which is the parent firm of TACA International Airlines (TA, San Salvador Int'l) – launched a lawsuit against Avianca and its major shareholder Synergy Aerospace, owned by German Efromovich, earlier this year, seeking an injunction to suspend negotiations between Avianca and United. Kingsland claims the deal is underhanded and will only serve Synergy's interests. Avianca responded with a countersuit attempting to stop Kingsland from interfering in the deal.
At its shareholder meeting on March 31, Avianca adopted a resolution to undertake an investigation into the possibility of bringing legal action against Kriete. Unsurprisingly, Kriete has responded with harsh criticism. News site Estrategia & Negocios reports that Kriete has said the resolution is another example of Efromovich's self-dealing.
"The decision by the majority shareholder of Avianca to propose and then adopt a resolution authorizing an unfounded investigation of Roberto Kriete is nothing more than a reprisal by German Efromovich and Synergy in response to the legitimate efforts of Mr Kriete and Kingsland to recover Avianca's good corporate governance and to stop Efromovich's abuse of power," a statement from Kingsland said.
Also at the shareholder meeting, Synergy declined an offer from Kingsland to have an external auditor examine Efromovich's dealings with Avianca. Earlier this month, Kingsland said that if Synergy didn't comply, it intended to request a civil court in Panama to appoint independent auditors pursuant to Article 425 of the Commercial Code of Panama.