GoAir in advanced stage of stake sale

New Delhi: Promoters of GoAir, Wadias, are believed to be in advanced stage of talks to sell a substantial stake in the airline, which has already reduced its flights to cut down on losses. This could be the first step towards consolidation in the domestic aviation industry, which is bleeding due to spike in crude and jet fuel prices.
"Like all airlines, GoAir is also in need for funds but there is yet to be consensus on the airline's market worth which is delaying the deal. There's a huge difference in what is being offered and what the group is looking at," said market sources. Till the airline gets the required funding, its six-airline fleet (four of which are leased) are following a very pruned schedule to limit losses. It has also retrenched over 20% staff in past few days and this number could rise.
The airline's official website says it operated 561 weekly flights from 11 stations. Now the airline's marketing head, Neeraj Kapoor, said it operates about 800 monthly flights from seven stations. "We have taken off Jaipur, Bangalore, Cochin and Chennai from our network recently. These four stations used to contribute substantially to our flights," Kapoor said.
Indian carriers' attempts to find funds for their loss-making ventures — that can be as high as Rs 9 crore daily for giants like Air India-IA or Jet-JetLite — could get more desperate now as crude inches towards the $150 mark.
04/07/08 Times of India

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Categories: GoAir Jul 2008