Bangalore: Deccan Aviation may be a poor man’s airline but it has not been so for some of its investors who have made millions out of their initial investment into the venture.
The man who helped Capt G.R. Gopinath to launch India’s first low cost airline, S.N. Ladhani whose Brindavan Beverages invested about Rs 1.5 crore into Deccan Aviation has been able to mop up Rs 150 crore through a combination of sale of its shares in the open market and through the open offer of the UB Group.
Brindavan Beverages and Ladhani had totally about 18 per cent stake pre IPO which reduced to about 9 per cent after the open offer and now stands at a minuscule 3 per cent which indicates Ladhani’s dwindling interest in the airline.
ICICI Ventures and Capital One which invested about $40 million and had about 16 per cent stake each in the airline are learnt to have mopped up a total of around $90 million, sources close to the airline said. A clutch of NRIs, whose company Golden Ventures is based out of Mauritius, also made around $40 million from an initial investment of around $5 million.
“When the stock hit a peak of around Rs 300, Deccan Aviation was a billion-dollar company. Lot of investors and the public benefited from the surge,” Deccan Aviation’s Vice-Chairman, Capt G.R. Gopinath told Business Line.
AC Nielsen appointed
The UB Group is learnt to have appointed market research firm, AC Nielsen to carry out a survey to determine the branding of the merged entity. The survey is expected to throw up results on whether the merged entity should retain the brand identity of Kingfisher Airlines as well as Simplify Deccan separately.
“Right now we are going through an internal debate on whether we should retain separate identities or not,” Capt Gopinath said. Sources in the airline said that while definite benefits from synergies at the back end was what brought the two airlines together, it remains to be seen whether both the airlines will now fly under a common name.
An airline analyst said that by retaining separate identities, both the airlines will not only expand the customer base but it will also help their bottomlines. The analyst pointed out that a low cost airline helps generate more customers or convert more travellers to switch over to flying.
In turn, it helps value or full service carriers to find more customers from a bigger pool to fly their airlines. “Low cost airlines and full service carriers complement each other and a corporate entity which owns both these airlines benefits the most,” the analyst said.
The man who helped Capt G.R. Gopinath to launch India’s first low cost airline, S.N. Ladhani whose Brindavan Beverages invested about Rs 1.5 crore into Deccan Aviation has been able to mop up Rs 150 crore through a combination of sale of its shares in the open market and through the open offer of the UB Group.
Brindavan Beverages and Ladhani had totally about 18 per cent stake pre IPO which reduced to about 9 per cent after the open offer and now stands at a minuscule 3 per cent which indicates Ladhani’s dwindling interest in the airline.
ICICI Ventures and Capital One which invested about $40 million and had about 16 per cent stake each in the airline are learnt to have mopped up a total of around $90 million, sources close to the airline said. A clutch of NRIs, whose company Golden Ventures is based out of Mauritius, also made around $40 million from an initial investment of around $5 million.
“When the stock hit a peak of around Rs 300, Deccan Aviation was a billion-dollar company. Lot of investors and the public benefited from the surge,” Deccan Aviation’s Vice-Chairman, Capt G.R. Gopinath told Business Line.
AC Nielsen appointed
The UB Group is learnt to have appointed market research firm, AC Nielsen to carry out a survey to determine the branding of the merged entity. The survey is expected to throw up results on whether the merged entity should retain the brand identity of Kingfisher Airlines as well as Simplify Deccan separately.
“Right now we are going through an internal debate on whether we should retain separate identities or not,” Capt Gopinath said. Sources in the airline said that while definite benefits from synergies at the back end was what brought the two airlines together, it remains to be seen whether both the airlines will now fly under a common name.
An airline analyst said that by retaining separate identities, both the airlines will not only expand the customer base but it will also help their bottomlines. The analyst pointed out that a low cost airline helps generate more customers or convert more travellers to switch over to flying.
In turn, it helps value or full service carriers to find more customers from a bigger pool to fly their airlines. “Low cost airlines and full service carriers complement each other and a corporate entity which owns both these airlines benefits the most,” the analyst said.
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