This case study is a sequel of the case titled, ‘The First Low Cost Carrier of India’ written by the present author in the year , when the homegrown airline Air. Accenture favours a merger between Air Deccan and Kingfisher Airlines. The Kingfisher Airlines-Deccan Aviation merger swap ratio has been fixed at This means shareholders in the UB group-promoted.

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OutlookReport released, March 7,kintfisher on January 10, www. Never miss a great news story! Meanwhile, the Wilbur Ross consortium is understood to be making efforts to renegotiate with IFCI to put in a bid though its officials maintain that legally, IFCI cannot entertain any offers from this process. According to sources, the merged airline will look at equity rather than debt to raise funds going forward.

Media center, 23 February, accessed on January 5, www. Officials from the factories mingfisher the iconic brands believe that the Indian auto maker would offer more long-term security than One Equity, the other leading bidder. We are looking at increasing capacity and not pricing.

Airline experts say Mallya has a tough job on his hands. In fact, when Deccan planned an inflight magazine to communicate with its customers and earn through advertisinginvestors were paranoid. Abstract This case study is a sequel of the case titled, ‘The First Low Cost Carrier of India’ written by the present author in the yearwhen the homegrown airline Air Kinggfisher was at its zenith and kingfisehr becoming a game changer of the Aviation sector in India.

The group’s backing is a pillar for us,” he had said.

swap for Kingfisher-Deccan merger | Business Standard News

We hope to break even in the next fiscal. An increase in the revenue through reduction in costs would follow because of the operation of an airline that will have about flights a day. But neither Kingfisher nor Jet Airways are 60 years old and the younger an airline is, the easier it is to change its footprint,” Forte said. How to cite item. Find this comment offensive?


After the merger, Vijay Mallya will serve as chairman of the new meerger, while co-founder of Deccan Aviation, Capt Gopinath will be its vice-chairman. Air Deccan, which has been struggling with growing losses ever since it started, is running out of cash almost as soon as it raises it.

Inwhen it started its operations, losses were about Rs crore Rs 2. What is the expected range for the share swap ratio? Your Reason has been Reported to the kinvfisher.

To see your saved stories, click on link hightlighted in bold. NIFTY 50 10, 2.

Give us some pointers as to how valuation will be done. Foul language Slanderous Inciting hatred against a certain community Others. Aviation consolidation looming in India: Kingfsiher, despite the fact that these were subsidiaries, whose operations were independently managed. Email this article Login required. Fill in your details: The criteria defined for this are laid down by the Supreme Deccsn and will be based on the net asset value, market price and the discounted cash flows, which would be the deciding factors for reaching the ultimate swap ratios.

Order Reprints The reprints of this article are available at the rate of Rs. We would generate more revenue through our network strategy and good understanding of the consumers through the assets we have. The combined entity will also need large capital infusion for the proposed international forays by the two brands.

Furthermore, as the merger story unfolds, it brings out the truism of consolidation – that one man’s gain is another man’s loss.


Call for Papers – Entrepreneurship. However, inthe airline nose dived and Jerger Gopinath, its CEO, had to succumb to the consolidation proposed by Dr. The resultant negotiation power and costs saved in fuel and maintenance will be the added benefits. Kingfisher Airlines’ former CFO A Raghunathan, in response to a query some time ago, had said that the airline had got Rs crore Rs 5 billion in equity, loans and guarantees mergre the group.

Benefits of Kingfisher-Deccan merger

References Mergers are called amalgamations, while Takeovers are acquisition of a part of equity capital of a company that enables the acquirer to exercise control over the affairs of the company.

Governments are now deregulating operations and private carriers are moving in. Kinyfisher the airlines will retain their brand entities and also leverage respective business strengths. Annual financial reports, http: We expect savings of about Rs crore Rs billion kingfishet to accrue because of the synergies achieved due to the merger.

Deccan, Kingfisher to run as two separate entities post merger

How to Meet the Store Brand Challenge views since: Mixing everything in one company doesn’t work. Annual reportKingfisher Airlines Limitedp. Experts say the Qantas model worked because Jetstar’s operation was independent. History is not on Mallya’s side.

In terms of percentages, our objective is not dilution, but raising required funds with the lowest valuation. We are sure we would be able to deliver and sustain. What we are looking at is an increase of Rs crore in the first six months in the bottom line once we launch the international operations.