Avianca shares fall after Colombian authorities search offices

by Bloomberg Feb 13, 2020

Avianca Holdings SA shares fell the most in a month Thursday after the airline’s offices were searched by Colombian authorities as part of a bribery investigation.

Colombia’s Attorney General’s office is investigating bribery claims related to the company’s former practice of giving free and discounted tickets to officials from Central American governments, according to a spokesperson for the office. Investigators executed a search warrant Wednesday afternoon at the air carrier’s headquarters in Bogota, searching for evidence, including computer files, related to the case.

Avianca shares dipped 3.4% to 2,010 pesos shortly after trading opened in Bogota, the biggest decline intraday since early January.

Avianca and its suppliers have made themselves available to authorities and are collaborating on the investigation, CEO Anko van der Werff said in brief remarks Thursday at an event launching a new brand, Avianca Express, which will serve domestic Colombian routes. He declined to elaborate.

The company itself disclosed the practice last year, saying in a regulatory filing that it had opened an internal investigation and hired outside counsel to carry out the probe. It was examining whether it had violated the U.S. Foreign Corrupt Practices Act or other laws. The company voluntarily disclosed the information to the U.S. Justice Department, Securities and Exchange Commission and Colombian regulators.

Avianca, which last year replaced its management team as part of a corporate shakeup that saw its former chairman ousted, is separately looking into whether it was the victim of wrongdoing in its relationship with Airbus SE. The European plane manufacturer reached a plea agreement last month with U.S., French and British authorities over a long-running bribery and corruption scheme.

Avianca’s internal investigation into that matter is ongoing, van der Werff said Thursday. Wednesday’s search by Colombian authorities was not related, a company spokeswoman said