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In an attempt to bolster its regional connectivity, InterGlobe Aviation, which runs budget carrier IndiGo, is in advanced stages of discussion to raise about $1.2-billion (₹7,800 crore) overseas funding to procure ATR aircraft.
Paris-based international banking group BNP Paribas is believed to have offered the ‘best rate’ for the airline company’s proposal to raise dollar funding, while Italian export credit agency SACE and Bpifrance, a subsidiary of Caisse des Depots and the French State, have agreed to provide counter guarantees.
“The talks are in advanced stages, and finance is expected to be tied up any time soon. This would be one of the largest fund-raising by the carrier and is mainly to procure aircraft to enhance regional connectivity,” a source close to the development told BusinessLine . A number of other leading banking firms are also said to be in the race. However, their names could not be immediately ascertained.
In May, IndiGo had announced plans to launch turbo-prop operations by the end of calendar 2017. The carrier, which only flies the Airbus A320 family, signed a term sheet with French-Italian aircraft maker ATR for purchase of 50 ATR 72-600s worth $1.3 billion, with the flexibility to reduce the number based on certain terms.
“The induction of the aircraft will begin immediately after the funds are tied up, which is expected to close by October-end or latest by mid-November. Following which IndiGo will begin to induct aircraft and start operations, starting with the Southern States,” another source added.
When contacted, IndiGo and BNP Paribas declined comment, while e-mails sent to SACE and Bpifrance did not elicit any response at the time of going to press.
The new aircraft will be used to start flights under the Government’s regional air connectivity scheme, UDAN.
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