Kingfisher Airlines is examining the option of a reverse merger with Deccan Aviation to remove regulatory obstacles for Kingfisher in using Deccan’s permits to fly abroad.
MUMBAI: Kingfisher Airlines is examining the option of a reverse merger with Deccan Aviation. If the move comes to fruition, it is expected to remove regulatory obstacles for Kingfisher in using Deccan’s permits to fly abroad.
Rup Pillai, director, Kingfisher Airlines, told DNA Money: “It is certainly an option that we are considering. We are waiting for the report from Accenture before taking a decision.”
Meanwhile, Deccan Aviation witnessed yet another huge spike in its share prices which closed the day up nearly 18% on speculation of a restructuring activity.
Captain Gopinath, managing director, Deccan Aviation, said: “I cannot confirm anything, it may happen or it may not happen. We are running a business here and we are not bothered about speculation in the stock market. Only me or Vijay Mallya will disclose our plans.”
Airline scrips, including Deccan Aviation, Jet Airways, SpiceJet and Jagson Airlines recorded impressive gains at the bourses. The pack was led by Deccan Aviation which, after reaching a high of 254.80 during intraday trading, closed at 248.50, up 17.94 % on the BSE.
While analysts whom DNA Money spoke to attribute the spike in Deccan shares to rumours of the reverse merger, they expressed surprise at the upturn in the rest of the counters. Jet Airways gained around 4%, Spice Jet gained 6.62% and Jagson Airlines gained 7.04%.
In the case of Deccan, consulting firm Accenture was earlier hired to suggest ways to optimise benefits of the Deccan-Kingfisher combine. Reportedly, Accenture will be completing the report in January. Kingfisher Airlines has also been putting pressure on the government to allow it to use the overseas flying rights set to be granted to Deccan in 2008.
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