More airline mergers on the cards

New Delhi: The merger of the two state-owned carriers, Air-India and Indian, and the acquisition of Air Sahara by Jet Airways has set the ball rolling for further mergers and acquisitions.
Sources in Air-India told The Statesman that a detailed project report was being prepared on the scope for further mergers and acquisitions in the aviation sector. The Jet Airways chairman, Mr Naresh Goyal, has said that “mergers and consolidations were a reality now”.
According to civil aviation ministry officials, consolidation will occur through a process of closure or mergers and acquisitions, leaving around two to three full service carriers, three to four large national carriers and three to four niche, regional operators (with aircraft less than 80 seats).
The process, it is understood would begin this year, but ministry officials said given the overhang of foreign investment eager to enter the market, it may take some more time.
As the aviation industry is drastically expanding, India is in an “unusual situation” of having potentially billions of dollars of investment preparing to enter the sector, but the lack of a clear policy is a deterrent. The sector is eagerly awaiting the “Civil Aviation Policy” expected to be announced shortly.
22/04/07 Sanjay Singh/The Statesman

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Categories: General Aviation Apr 2007