New Delhi: Delhi-based low-cost airline IndiGo has clarified that it is not in talks to pick up a stake in Virgin Australia (VA).
In a statement to the media, Ronojoy Dutta, Wholetime Director and Chief Executive Officer, IndiGo said: “We deny the contents of these reports and would like to clarify that IndiGo has not formulated any indicative proposal, nor does it have any interest in this matter.” VA went into liquidation recently with a debt of around $5 billion.
However, despite this denial, rumours continue to float that InterGlobe Enterprises, a large Indian conglomerate with positions in aviation (IndiGo airlines), hospitality and travel-related services, is interested and is examining the possibility of putting in a bid for VA.
A more in-depth look at the scenario, however, makes it clear that this marriage between the two is unlikely to solemnise.
Industry watchers give many reasons why this is so. First, Virgin Australia is not a low-cost airline making its customer profile different from that of IndiGo which is an out and out low-cost airline.
“Virgin Australia moved from a low-cost airline to a full-service airline while IndiGo has continuously maintained that they are comfortable being a low-cost airline hence there is a definite mismatch there, Being a full-service airline, the profile of customers (business, value-added service needs, loyalty programs etc.) will be different and hence not much synergy can be extracted,” said an industry watcher who declined to be identified as IndiGo has officially denied that it is picking up a stake in VA.
Another industry watcher felt that it would be surprising if InterGlobe enters the Australian market through the acquisition of VA.
12/05/20 Ashwini Phadnis/Business Line
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In a statement to the media, Ronojoy Dutta, Wholetime Director and Chief Executive Officer, IndiGo said: “We deny the contents of these reports and would like to clarify that IndiGo has not formulated any indicative proposal, nor does it have any interest in this matter.” VA went into liquidation recently with a debt of around $5 billion.
However, despite this denial, rumours continue to float that InterGlobe Enterprises, a large Indian conglomerate with positions in aviation (IndiGo airlines), hospitality and travel-related services, is interested and is examining the possibility of putting in a bid for VA.
A more in-depth look at the scenario, however, makes it clear that this marriage between the two is unlikely to solemnise.
Industry watchers give many reasons why this is so. First, Virgin Australia is not a low-cost airline making its customer profile different from that of IndiGo which is an out and out low-cost airline.
“Virgin Australia moved from a low-cost airline to a full-service airline while IndiGo has continuously maintained that they are comfortable being a low-cost airline hence there is a definite mismatch there, Being a full-service airline, the profile of customers (business, value-added service needs, loyalty programs etc.) will be different and hence not much synergy can be extracted,” said an industry watcher who declined to be identified as IndiGo has officially denied that it is picking up a stake in VA.
Another industry watcher felt that it would be surprising if InterGlobe enters the Australian market through the acquisition of VA.
12/05/20 Ashwini Phadnis/Business Line
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