Paramount Airways will buy 40 Embraer jets, costing about $2 billion, managing director, Mr M Thiagarajan said here today. Deliveries of the new 70-seater planes are likely to take place between 2008 and 2011, he said after a meeting with the visiting Brazilian President, Mr Luiz Inacio Lula da Silva. The agreement will be signed next month in the Latin American nation.
Mr Thiagrajan said funding for new aircraft could be a mix of debt and equity with a balloon payment when the agreement is signed. At present, the Chennai-based airline uses five leased Embraer jets. It serves eight cities in the south with 52 daily flights. Paramount, which started its operations in the second half of 2005, also plans to expand its operations across western India, Mr Thiagrajan said. “We want to focus, saturate and dominate the southern region first, and then move on for a pan-India presence by 2011,†he added. He said Paramount is looking at acquiring another airline, provided synergies and valuations are right. “We want to expand into western India later this year, and if (acquisition) opportunities arise in there, we will be more than happy to go for it,†he said.
Mr Thiagarajan declined to comment on the specific GoAir proposal which, investment bankers revealed, had approached Paramount for a deal valued at $150 million. The GoAir managing director, Mr Jeh Wadia, in Mumbai today denied reports that Paramount Airways was picking 40 per cent stake in the low-cost airline but said various investors have shown interest in the airline. “There is no truth in the reports that Paramount is taking stakes in GoAir and neither is that group among those investors who have shown interest in GoAir,†Mr Wadia said. The last three months have seen three mergers taking shape, including Jet Airways’ acquisition of Air Sahara, a purchase of 26 per cent stake in Air Deccan by Kingfisher Airlines, and amalgamation of government-owned Air-India and Indian. Source: StatesMan
