Mallya has big plans for Kingfisher Airlines
Kingfisher Airlines chief Vijay Mallya has big plans for its recently launched budget airline. The parent company United Breweries has offered quite a modest amount for the Air Sahara who were expecting an amount ranging between $750-1,000 million. Interestingly, Mallya claimed that their own evaluation of the airline company found the worth of the company to be pretty less than what they had claimed.
Mr. Mallya told reporters: â€œMy offer is lesser than the price quoted by Ernst & Young for the airline.â€ Ernst & Young were appointed by Air Sahara to raise funds for the airline and the agency had valued the airline at $750-1,000 million. Kingfisher Airlines is now awaiting a reply from Air Sahara over their offer.
Market experts believe that if Kingfisher Airlines were to takeover Air Sahara, it would help Kingfisher access a ready-made infrastructure network including additional landing slots at airports. Air Sahara is currently the countryâ€™s third largest domestic airline. They would also get the advantage of circumventing the clause by the Indian government preventing domestic airlines with less than five years of flying experience and less than 20 planes to fly overseas destinations.
Mallya also said that he was planning to raise $200 million through an IPO in 2006 to fund aircraft purchase for Kingfisher Airlines.