Mallya & Gopinath: Another mega alliance in the offing?

If media reports are to be believed, India's largest budget carrier Air Deccan seems to be attracting a number of suitors. While Kingfisher Airlines supreme Vijay Mallya went public about his plan to pick up a stake in the low-cost carrier, media reports suggested that Deccan's original investor Lachmandas Ladhani, who holds around 11% stake, is likely to exit the airline.
The fact that the one year post-IPO lock-in period on Ladhani's shares is ending soon has lent some credence to the reports. Reports indicated that Ladhani has begun parleys with potential suitors, including a UK-based PE firm and the Anil Dhirubhai Ambani Group (ADAG) which already holds 4.63% through mutual funds.
Though he reacted angrily to Mallya's public announcement saying Deccan was not for sale, Captain Gopinath admitted to a TV channel that he needs for money to run the airline.
Rumour mills are going abuzz once again as this admission by Gopinath preceded by a surprise appearance by him at the second anniversary celebrations of Kingfisher Airlines.
It seems he feels that the market price is not good enough for Deccan despite the strong showing by the scrip recently. The events of the week left several experts thinking that the consolidation in aviation may happen much earlier than predicted by them.
13/05/07 Economic Times

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Categories: Air Deccan May 2007, Kingfisher May 2007