Vijay Mallya today moved decisively towards controlling the largest share of the domestic aviation market. His UB Holdings, the parent company of Kingfisher Airlines, is acquiring 26 per cent of Bangalore-based Deccan Aviation’s equity for close to Rs 550 crore, pegging its valuation at Rs 2,200 crore.
The markets, anticipating this, boosted the stock of Deccan Aviation, which runs India’s first low-cost carrier Air Deccan, by 11% to Rs 146 at the close of trade on Bombay Stock Exchange. The offer of Rs 155 a share represents the 26-week average.
Deccan has 18% share of the market and Kingfisher close to 11%. Market leader Jet Airways as 25%.
Deccan Aviation is making a preferential allotment of a little over 35 million shares to UB, after which UB will be required under the law to make an open offer for another 20% at the same price. If the offer is fully subscribed, UB will have to pay another Rs 425 crore to take its total holding to 46%.
Read more in The Business Standard article.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment