Anil eyes 26% in Air Deccan, leads race

Mumbai: The Reliance Anil Ambani Group appears to be leading the race to pick up a minority stake in India’s largest low-cost carrier Air Deccan. The group has submitted a bid along with other investors such as the Texas Pacific group for investment in the company.
The potential investors have been carrying out a due diligence of the Bangalore-based airline over the past month and bids are in with Edelweiss Capital, the investment banker to the deal, sources said. A Reliance ADAG spokesperson denied that the group was in talks to buy a stake in the airline.
Air Deccan sources refused to comment, saying the bids were still being evaluated. Sources close to the matter said that the investor is likely to put in roughly $100 million into the airline, shoring up the airline’s depleted cash position. Discussions are on to place about 26% with Reliance ADAG.
Some warrants are also likely to be issued to the promoters of Air Deccan.
The Reliance ADAG group’s mutual fund arm, which held 3.43% in Air Deccan, has recently increased it to 4.65%. Texas Pacific has strong interest in airline companies.
19/04/07 Cuckoo Paul & R Sriram/Economic Times

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Categories: Air Deccan Apr 2007