Air Sahara on Wednesday said it is looking to raise funds to finance its expansion and also, that the company is valued at between $750 million and $1 billion.
For the purpose, the airline, a part of Subroto Roy's Sahara India Parivar, has appointed Ernst & Young as its advisor for finding the strategic partner.
"The airline confirms the appointment of Ernst & Young as advisor to business plan validation, valuation and fund mobilisation through strategic partners for private equity placement," Air Sahara said in a statement.
Air Sahara further said that it has not identified the strategic investment partner so far.
Refuting reports about its deal with SpiceJet, Rono Dutta, president, Air Sahara, said in the statement, "We confirm our willingness to look at alliances and partnerships that could contribute to our own expansion and growth plans, but nothing has been finalised yet. Initial estimates by Ernst & Young have put our enterprise value between $750 million and $1 billion, and not a meager $300 million as reported by the press."
Air Sahara's plans for private placement will be governed by strict government norms, which prevent foreign airlines and funds with foreign airlines as equity partners to invest in Indian carriers.
The airline, which started operations in 1993, is currently in an expansion mode and by November this year, it plans to operate 140 flights a day. At present, it operates with a fleet of 26 leased aircraft to 25 destinations and operates 123 flights a day.
Air Sahara, which also operates international services, has a cod-sharing agreement with American Airlines. As part of the agreement, American Airlines will launch non-stop daily flights between Delhi and Chicago from November 2005.
Air Sahara also has acquired seven slots per week at London Heathrow and has a marketing agreement with British Airways to launch joint marketing and fares, synergise ground services, joint frequent flier programmes and explore the potential of code-sharing agreement in the future.
