Gol Linhas Aereas Inteligentes agreed to purchase Varig

Brazil's for US$320 million in cash, stock and assumption of debt. According to Gol, the combination would "establish a Brazilian airline group with a growing passenger base of over 20 million annually, capable of competing on the South American and world stages against other large international airlines." Gol and Varig would be operated independently, with distinct brands and "differentiated services." Varig's long-haul fleet would be expanded, allowing for service to certain European, North American and South American cities. Subject to regulatory approval, Gol's proposal follows media speculation that Brazil's Tam and leading South American airline Lan would jointly bid for Varig.