The Hindu Business Line : Air Deccan willing to hold talks with Virgin's Branson

AIR DECCAN said that it is willing to hold talks with the Virgin Atlantic Chairman, Mr Richard Branson, who is keen to invest in his personal capacity in an Indian carrier to sidestep regulatory curbs on foreign airlines investing in domestic airlines.

"We are willing to hold discussions with him but only if we don't violate any regulatory norms," the Air Deccan Managing Director, Capt G.R. Gopinath, told Business Line.

Mr Branson has already said that he is in talks with a few airlines and those who want to enter the airline business. He said he would be willing to buy 25 per cent or even 49 per cent stake in any of these airlines.

Air Deccan had earlier initiated talks with Virgin to part-fund its airline but had later called off the talks because the Government norms did not permit foreign airlines buying a stake in a domestic venture.

Capt Gopinath said the airline is close to wrapping up funding for expansion. "We should be able to wrap up the funding within 15 - 20 days." Hence, the airline may not require more funding immediately.

He said the airline's investment bankers Rothschild has shortlisted four FIs and a decision on funding would be taken shortly. The airline plans to raise up to $60 million to expand its fleet. In a period of five years, the airline plans to have a fleet strength of around 60 consisting of 30 ATRs and an equal number of Airbus aircraft.

Last week, Air Deccan said it had lowered its revenue target for the current fiscal to around Rs 41 crore from Rs 54 crore projected earlier because of delay of about two months in the induction of the Airbus A-320 aircraft. Currently, there are five individual investors who have funded the parent company, Deccan Aviation Pvt Ltd, of which Air Deccan is a wholly owned subsidiary. These investors are Mr Kenichi Miyagawa who holds 30 per cent equity, Capt G.R. Gopinath who holds 26 per cent, Capt Samuel holds 25 per cent, Mr Ladhani holds 10 per cent and Mr Vishnu Rawal holds 9 per cent equity.

Of these, Mr Miyagawa is an American, while Mr Rawal is a non-resident Indian. The paid-up equity is around Rs 10 crore.

The company has also raised debt from Bank of India.