Nevrekar
8th Jul 2008, 15:41
Billionaire Wilbur Ross in Talks With India SpiceJet (Update1)
By Vipin V. Nair
July 8 (Bloomberg) -- U.S. billionaire investor Wilbur Ross, who made his fortune taking over bankrupt steel, coal and textile companies, said he is in talks with India's SpiceJet Ltd. for a possible investment in the money-losing carrier.
``We are having discussions with SpiceJet, but it is too early to know whether the negotiations will be successful,'' Ross said in an e-mail today.
New Delhi-based SpiceJet, the nation's second-largest budget airline, and rivals are looking for investment after record high fuel prices drained funds needed to expand. Indian carriers may double their combined losses to $1.5 billion this year because of rising fuel expenses, the Centre for Asia Pacific Aviation, an industry consultant, predicted last month.
``Smart investors know that this is a good opportunity to acquire assets,'' said Kapil Kaul, chief executive of the local unit of the Centre. ``In the long term, the Indian aviation market will be big and institutional investments will continue to flow in.''
Ross' first investment in India was in October 2006, when he acquired OCM India Ltd., a worsted suiting maker, for $37 million, according to data on Bloomberg.
The Economic Times reported today that Ross is competing with Indian billionaire Vijay Mallya to invest in SpiceJet. The carrier gained 22 percent yesterday after the newspaper reported July 5 that Mallya would pay cash for the stake.
SpiceJet yesterday said its board didn't consider selling the stake to Mallya, who controls rival Kingfisher Airlines, at a board meeting June 30. The company reiterated it had appointed a financial adviser to help it raise funds.
The shares dropped 2.3 percent to 29.75 rupees in Mumbai, extending this year's decline to 66 percent.
By Vipin V. Nair
July 8 (Bloomberg) -- U.S. billionaire investor Wilbur Ross, who made his fortune taking over bankrupt steel, coal and textile companies, said he is in talks with India's SpiceJet Ltd. for a possible investment in the money-losing carrier.
``We are having discussions with SpiceJet, but it is too early to know whether the negotiations will be successful,'' Ross said in an e-mail today.
New Delhi-based SpiceJet, the nation's second-largest budget airline, and rivals are looking for investment after record high fuel prices drained funds needed to expand. Indian carriers may double their combined losses to $1.5 billion this year because of rising fuel expenses, the Centre for Asia Pacific Aviation, an industry consultant, predicted last month.
``Smart investors know that this is a good opportunity to acquire assets,'' said Kapil Kaul, chief executive of the local unit of the Centre. ``In the long term, the Indian aviation market will be big and institutional investments will continue to flow in.''
Ross' first investment in India was in October 2006, when he acquired OCM India Ltd., a worsted suiting maker, for $37 million, according to data on Bloomberg.
The Economic Times reported today that Ross is competing with Indian billionaire Vijay Mallya to invest in SpiceJet. The carrier gained 22 percent yesterday after the newspaper reported July 5 that Mallya would pay cash for the stake.
SpiceJet yesterday said its board didn't consider selling the stake to Mallya, who controls rival Kingfisher Airlines, at a board meeting June 30. The company reiterated it had appointed a financial adviser to help it raise funds.
The shares dropped 2.3 percent to 29.75 rupees in Mumbai, extending this year's decline to 66 percent.