Saturday, July 08, 2017

IndiGo co-founders say Air India would provide rapid entry into restricted international markets

The owners of IndiGo, the only airline that has made a formal offer to acquire loss-making Air India, held an hour-long conference call on Thursday to calm the nerves of jittery investors.
Speaking on the rationale behind their pitch to acquire debt-ridden carrier, IndiGo owners Rahul Bhatia and Rakesh Gangwal emphasized IndiGo's need for Air India's international operations to gain access to several restricted and closed overseas markets.
"Air India's international operations would bring a very important element to our network," IndiGo co-founder Rahul Bhatia said during the conference call.
According to Bloomberg, IndiGo's bid for Air India had earlier wiped out more than $500 million in the market value of country's most profitable airline.
IndiGo, which commands a 41 per cent market share of India's airline industry, is keen on expanding to long-haul destinations. The airline is already operating its flights to seven international destinations like Dubai, Singapore, Sharjah, Bangkok, Doha, Muscat and Kathmandu.
India, currently the third largest aviation market, is witnessing domestic traffic growth of 15 per cent to 20 per cent every year.
"India represents one of the largest untapped international air transportation market opportunities that is out there, and the country certainly lacks its fair share of long-haul international flights," Bhatia said in his opening remarks.
Stressing that IndiGo's interest in buying Air India is mostly limited to its international operations Rakesh Bhatia said, "IndiGo is not looking at acquiring all of Air India's businesses and subsidiaries. we are interested in the airline operations of Air India. And more specifically, we are focused narrowly on Air India's international operations and Air India Express."
07/07/17 Business Today