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Wadia family may sell 26% stake in GoAir

Wadia family may sell 26% stake in GoAir
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First Published: Fri, Oct 05 2007. 12 41 AM IST
Updated: Fri, Oct 05 2007. 12 41 AM IST
New Delhi: The Wadia family is evaluating proposals to sell a stake in GoAir Pvt. Ltd, a low-fare carrier. “We are still vetting these proposals, we have not made a decision,” Jeh Wadia, the Mumbai-based airline’s managing director, said at a news conference in New Delhi on Thursday, without providing details.
The family may sell “potentially up to 26%. It depends on many terms and many conditions,” he added.
Indian low-fare carriers are seeking alliances or merging to reduce costs. At least five airlines have started in the past four years, lured by a market that may grow 25% annually until the end of the decade.
“We are not in a hurry to choose a partner,” said Wadia. “Once as shareholders we have created value for us first, then only will we take it to public shareholders and other private shareholders. We want to demonstrate we have created value.”
The Wadia Group fully owns GoAir, Wadia said. The group owns businesses ranging from the airline, GoAir, to chemicals, National Peroxide Ltd., to plantations, the Bombay Burmah Trading Corp., to cookie maker Britannia Industries Ltd., according to the group’s website.
GoAir, which had five aircraft, on Thursday took delivery of its sixth aircraft — an Airbus SAS A320, it said in a news release.
The company’s fleet size will increase to 34 by March 2011, Wadia said, lower than its earlier target of 50. “We decided to scale down growth plans in order to allow infrastructure to develop. We have to be reasonable,” said Wadia. “This is a marathon. We are not running a 100-meter dash.”
Budget airlines account for 20% of all seats on sale worldwide, compared with 17% a year earlier.
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First Published: Fri, Oct 05 2007. 12 41 AM IST