AirAsia Scraps $80m Deal to Buy....
AirAsia’s Attempt to Buy Batavia Air Ends
AirAsia, the biggest budget carrier in Asia and Fersindo Nusaperkasa, its Indonesian partner, have scrapped plans to buy Indonesian carrier Batavia Air after the sides failed to reach an agreement, Dow Jones Newswires reported on Thursday, quoting an official at Batavia Air.
“We will continue to seek strategic partners to develop our business,” Batavia Air chief executive director Yudiawan Tansari told Dow Jones.
Jakarta Globe | October 12, 2012
AirAsia Scraps $80m Deal to Buy Indonesia’s Batavia Air
AirAsia, Asia’s largest budget carrier, has scrapped a $80 million deal to buy Indonesia’s Batavia Air because the move would have carried too many risks, AirAsia Group CEO Tony Fernandes said.
Malaysia-listed AirAsia had announced plans in July to acquire Batavia in a bid to expand in Southeast Asia’s biggest economy. It would have been AirAsia’s first major airline acquisition and would have ratcheted up competition in Indonesia among low-cost carriers such as Lion Air and flag carrier Garuda’s Citilink unit.
“Our aggressive focus in Indonesia remains and we will push our Indonesian IPO plans while still maintaining close co-operation with Batavia Air,” Fernandes said in a statement on Monday.
“The company’s decision was based on a thorough evaluation by many parties into Batavia Air. In our minds, the timing was perhaps not appropriate as it would have induced too many risks and would ultimately be earnings dilutive to our shareholders.”
Fernandes in the past has expressed caution towards acquisitions, calling them “value-destroying” in an interview with Reuters last year.
AirAsia will now collaborate with Batavia Air on other aspects of the aviation business, including a training joint venture to address an expected skilled pilot shortage in Indonesia, the statement said.
AirAsia shares were down 0.3 percent in early trade.
Reuters.....October 15, 2012
Last edited by jetjockey696; 15th Oct 2012 at 05:36.