Billionaire industrialist Mukesh Ambani-led Reliance Industries today forayed into the aviation space as a "strategic investor" with over 26 per cent stake in captain Gopinath-founded cargo airline Deccan 360.
While the companies did not disclose the quantum of investment, RIL said that a wholly-owned subsidiary would provide "growth capital" for the new cargo airline.
Later speaking to reporters here, Gopinath said RIL's stake would be over 26 per cent, but below 50 per cent. He, however, declined to comment when asked about the capital infused by Reliance Industries.
"We want to make it clear that it is not a sale... We would rather say that they (RIL) have invested in the company," he said, adding that RIL would have two nominees on Deccan 360's five-member board of directors.
"We were in talks with some private equity players and some other potential strategic investors, but we chose Reliance, not because theirs was the highest bid, but because of strategic advantage of this deal," he said, but did not elaborate further.
Gopinath said that the company has an employee strength of 300, while it has a network of 60 franchises with an additional workforce of 1,500.
As many as 3,000 applications were received when the company invited franchisees to join it, he added.
"We believe that our collaboration with Deccan 360 will see a transformation in the logistics domain in India," RIL's Chairman and MD Mukesh Ambani said in a statement.
RIL's investment would help Deccan 360 increase its air and surface network coverage across the country, the company said.
Deccan 360 is already present in 50 cities and would expand to 100 cities in the next 12-18 month, Gopinath said.
He, further said that RIL and Deccan 360 would start discussions from Monday to finalise the areas of potential cooperation.
Deccan 360 is developing a 50-acre hub at Nagpur in Maharashtra and currently has eight freight aircraft covering 15 airports and a fleet of over 300 trucks and 850 vehicles nationwide.
Gopinath is credited with pioneering low-cost passenger airline service in India and had previously founded Air Deccan, the country's first budget air carrier that he later sold to billionaire industrialist Vijay Mallya-led Kingfisher Airlines.