Chile's LAN Airlines and Brazil's TAM announced Friday they have completed the process of creating a single parent company, LATAM Airlines Group, Latin American's largest air carrier with a market value of more than $12.5 billion.

In the last step in the merger, TAM shareholders exchanged 99.9 percent of their shares for those of LAN (renamed LATAM) at a ratio of 0.9 shares of the merged company for each share of the Brazilian airline.

"The creation of this group of airlines is an opportunity to take South America to the world and to allow us to position ourselves to operate in an increasingly competitive environment due to the continuing consolidation of the global airline industry," the executive vice president and CEO of LATAM Airlines Group, Enrique Cueto, said.

For his part, TAM Vice President Mauricio Rolim Amaro said "the growth LATAM Airlines Group is expected to generate will allow us to offer flights to new destinations for our customers, create more opportunities for our more than 51,000 employees and greater value for shareholders."

LATAM will initially offer passengers flights to 150 destinations in 22 countries and cargo flights to 169 cities in 27 countries.

In terms of its corporate structure, Amaro will be the chairman of LATAM's board of directors, while Cueto will be the merged company's executive vice president and CEO.

Cueto said the two airlines of the group will maintain their current headquarters in Santiago and Sao Paulo and will continue to operate under their existing brands. EFE