GoAir in talks with FIIs to raise $100 mn to buy planes

GoAir in talks with FIIs to raise $100 mn to buy planes

Mumbai: Wadia group-promoted budget air- carrier GoAir is in the process of raising around $100 million to fund its aircraft acquisition programme, airline sources said on Tuesday.

The airline is currently in talks with financial institutions and a deal is expected to be arrived at over the next 2-3 months, they said.

GoAir, which currently has 10 Airbus A-320s in its fleet, plans to take delivery of another 10 aircraft over the next three years.

“We are negotiating with some banks and financial institutions to raise around $100 million (around 400- 500 crore), both in India and abroad," the sources close to the development told PTI.

The airline, however, is still evaluating the instruments to raise the funds, they said, adding “a decision on the issue is likely to be taken shortly."

The resources raised would be utilised to fund the aircraft acquisition plan, they said.

“The airline expects to complete the fund-rasing exercise latest by January next year," the sources said.

With the growth in aviation sector picking up after a two years of recession, the airline in July this year had advanced the delivery of 10 planes, the orders for which it had placed with the European aircraft maker Airbus in 2006.

The airline had placed orders for 20 A-320 planes then worth $1.2 billion, with their deliveries staggered over two tranches of 10 aircraft each.

While the first tranche of delivery of 10 aircraft was completed last month, the delivery of the second tranche of airplanes is expected to began from September next year.