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Air Sahara gung-ho about future

Shrugging off the deal with Jet, Sahara outlined major aircraft induction plans. In graphics: The anatomy of a 'doomed' deal

india Updated: Jun 23, 2006 01:45 IST

Virtually shrugging off the brief honeymoon with Jet Airways, which had sought to acquire it for Rs 2,300 crore as an 'unfortunate' experience, Air Sahara on Thursday debunked reports of a cash crunch and outlined its major aircraft induction plans over the next few months.

Even as the two sides got into a legal battle over the failed deal, Air Sahara President Alok Sharma asserted that the company was not facing any cash problem and was not looking at raising funds from the market. On the contrary, it would strive to get 'fair revenue share' in the domestic aviation pie.

Refusing to take any question on the ongoing battle with Naresh Goyal controlled Jet Airways, with whom Air Sahara's Share Purchase Agreement expired on Wednesday night on the ground of it being 'subjudice', Sharma said that the deal was not out of compulsion.

"We had gone to the market last year for raising some funds and then we realised some interesting proposals and had accordingly gone for the deal with Jet. The deal was done on a certain perspective. But the same was not adhered to (by Jet). It is a matter of ethics for us more than anything else," Sharma said in an exclusive interview wondering what was their fault if Goyal did not get the security clearance from the government.

Jet gave us an advance of Rs 500 crore, besides pumping in over Rs 200 crore in Air Sahara operations, he said, adding that Rs 1,500 crore was in the escrow account.

While Jet officials could not be contacted for their comments, Sharma said that minus the deal Air Sahara would still have posted profit during 2005-06 as it had done in the previous financial year.

Stating that the company's primary focus would be to strengthen its operations and regain revenue share denoting the yield per passenger, Sharma said that Air Sahara would induct four more Boeing 737-800 aircraft by the end of the year in addition to two it had already got in February-March.

"In addition we have placed orders for ten more 737-800 aircraft," Sharma said signalling a clear expansion spree of the company, which was perceived to be under financial pressure.

Sharma, who had visited the airport here to oversee Air Sahara operations after taking charge of the aviation business of the group, was busy during the day holding parleys with heads of departments and other senior officials.

Asked if there was despondency among the staff in the wake of the controversy over the deal, Sharma said, "on the contrary, employees were rejoicing and distributing sweets. There is a lot of enthusiasm and I can guarantee that operations will improve in the coming days."

Meanwhile, sources said one of the primary tasks before Sharma would be to bring the flight schedules to normalcy and make full use of aircraft to improve the passenger traffic and increase revenue.

Asked about the possibility of renegotiation with Jet, he said that there would be no renegotiation on the price.