Deccan to raise $100 mn to spread its wings

Deccan Aviation, the operator of the country's biggest low-fare airline, plans to raise as much $100 million to expand operations.

Deccan is in talks with private equity investors and will take a decision by the month-end, Vijaya Menon, a spokeswoman at the Bangalore-based company, said in a phone interview today. She declined to provide details.

Deccan raised 16 per cent less than targeted in an initial public offering last year. Airlines in the country may raise more than $1 billion this fiscal as they post losses due to growing competition, according to the Centre for Asia Pacific Aviation, an industry consultant. Phone calls to Deccan's managing director GR Gopinath and Chief Operating Officer Warwick Brady, seeking comment on the fund-raising plan, weren't answered.

Indian carriers are raising money also to buy new planes from Airbus SAS and Boeing as economic growth and rising incomes boost demand for air travel in the world's second-most populous country.

Jet Airways, the nation's biggest airline, plans to sell as much as $400 million of stock in the next few months to fund a merger with rival Sahara Airlines and buy new planes, it said on April 16.

Deccan Aviation raised $100 million in October from two European lenders by pledging the right to buy 60 Airbus planes it ordered.