Mallya set to wrap up Deccan
The integration process of Kingfisher Airlines and Air Deccan is likely to be completed by September, when the new route-rationalization programme to avoid duplication of resources gets finalised and ground-level changes are visible.
Soon after Kingfisher acquired a 26 per cent strategic stake in Air Deccan on May 31, both the airlines had begun the process for integration.
During the past months senior executives of both airlines have been meeting regularly to assess the progress. “We are discussing all possibilities, including how to go ahead about product offerings, integrating engineering capabilities, unified logistics, sharing of training and manpower reduction at airports. This is at an advanced stage of finalization,” said an Air Deccan official.
Even as the UB group’s open offer to acquire an additional 20 per cent stake in Air Deccan is yet to get Securities & Exchange Board of India’s nod, both the airlines are heading towards leveraging substantial financial and synergistic benefits by integrating their operations over the last three months.
“In September there will a big announcement. The integration of Kingfisher Airlines and Air Deccan operations will substantially enhance our valuation,” said Kingfisher Airlines Chairman Dr Vijay Mallya. But Mallya denied any move to offload any stake to private equity firms. “Why should I sell cheap now? There is no requirement of funds. Our valuation is set to go up further and then we may think,” Mallya said.
While Air Deccan is likely to post profits hopefully by the next quarter, Kingfisher is projected to turn into black possibly in 2008.