Air Deccan's low cost operations may get some high value investments from private equities (PE).
According to sources it is planning to raise $50-100 million and has approached PE funds like TPG and Blackstone among others. Edelweiss securities has been appointed to zero in on the right investor.
Air Deccan is on a expansion mode and is trying to connect more cities especially smaller towns.
It hopes to utilise the equity infusion in funding its expansion and is also expected to provide Air Deccan with a substantial war chest to take on competition.
Air Deccan has a market capitalisation of about Rs 1,100 crore but valuation could go up smartly.
“We are evaluating multiple options and would finalise the organisation that best fits our business objectives. One that helps us in building a great airline and maximising shareholder value,” said Air Deccan spokesperson.
Air Deccan may dilute 25 per cent of equity to raise this money. With a fleet size of 43 aircraft and about 60 aircraft on order it has about 21 per cent of the Indian aviation market.
Source : NDTV Profit