Malaysian low-fare carrier AirAsia is looking to establish an associate carrier in Indonesia using its branding, as it prepares for its much-anticipated initial public offering (IPO).
AirAsia executives decline to comment on the Indonesia plans, citing disclosure rules in place ahead of its IPO. But South-East Asia's largest low-cost airline has reportedly acquired defunct Indonesian carrier AWAIR for a token $2 and is in talks with potential local partners.
Provided Indonesian government approval is granted, AirAsia is expected to relaunch the airline under its own branding, similar to its Thai associate carrier Thai AirAsia. Thai AirAsia is 49% owned by AirAsia and 51% owned by a company controlled by Thailand's prime minister.
AWAIR launched services in mid-2000, when it became the first new scheduled carrier in Indonesia in more than a decade. Cut-throat competition followed, however, and AWAIR suspended services early in 2002.
Meanwhile, bids have begun to flow in for fast-expanding AirAsia's planned IPO, which analysts say will probably raise between 800 million and 900 million ringgit ($210 million and $235 million). Funds will be used in part to help pay for new narrowbody aircraft from Airbus or Boeing.
The airline is close to an order for Airbus A320-family or Boeing 737-700/800s to replace its 737-300s. A deal is expected to cover at least 40 firm orders and rumours are flying that the A320 has been selected. The airline declines to comment further.
NICHOLAS IONIDES / SINGAPORE
Source: Flight International
