Search the Internet          Tips  Sites: Finance, Investment

Jet Airways plans private placement, IPO

India's largest private domestic airline Jet Airways is planning to issue equity through private placement and an initial public offer to buy new planes and expand market share, an industry source said on Tuesday.

Bombay-based Jet, which plans to increase its market share to 45 per cent over the next two years from 40 per cent, is talking to foreign banks and institutions to privately place around 10 per cent of its equity, the source added.

This will be followed by an offering of shares to the public.

The funds will be used to buy around 10 new planes worth $400 million and compete against the state-owned Indian Airlines in the battle for India's skies.

A company spokesman declined to comment on the plans.

Jet Airways is 100 per cent owned by its founder Naresh Goyal through an overseas holding company.

It has grown from a fledgling outfit in the early 1990s, when the government threw open airlines to the private sector, into India's largest private operator with a fleet of 33 aircraft.

The other nationally operating private sector airline is Sahara Airlines. Others, which have sprung up following liberalisation of the sector have either ceased or suspended operations.

Earlier, an economic daily had reported that Jet Airways has an equity of Rs 720 million ($15.31 million).

US investment bank Goldman Sachs and its local affiliate Kotak Mahindra Capital Company have been appointed to manage the transaction, the paper said.

Tell us what you think of this report