Air Carnival to change hands, 100% stake sale likely this week

By: | Published: April 3, 2017 7:23 PM

Promoters of Air Carnival are all set to sell their 100 per cent stake "possibly this week" for about Rs 73 crore in the regional airline, which started flying less than a year ago.

Air Carnival, Coimbatore Marine College, S Irudaya Nathan, Airline, Air Carnival stakePromoted by Coimbatore Marine College (CMC) group, Air Carnival commenced operations in July last year with one ATR-72 aircraft.

Promoters of Air Carnival are all set to sell their 100 per cent stake “possibly this week” for about Rs 73 crore in the regional airline, which started flying less than a year ago. Air Carnival is the second regional carrier after grounded Air Pegasus to scout for new owners amid funding issues. Promoted by Coimbatore Marine College (CMC) group, Air Carnival commenced operations in July last year with one ATR-72 aircraft. Confirming that the airline is on the block, Air Carnival Chairman and MD S Irudaya Nathan said discussions are in “advanced stages”.

“We are diluting entire stake in the carrier. The discussions (with the prospective buyer) are about to be finalised within this week,” Nathan told PTI from Coimbatore. He said the airline had planned to acquire two more aircraft by October 2016, but the efforts did not materialise as it could not raise the requisite funds. Subsequently, it was decided to “sell it (the airline) to a new owner and keep it afloat”, Nathan said.

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Without divulging details about the potential investor, he said, “The new investor has been chosen on first come first serve basis.” According to him, a price of Rs 73 crore has been quoted for the stake sale and that the “deal is likely to be signed by this Friday”. Air Carnival operates 10 daily flights to three cities –Chennai, Trichy and Tuticorn — from Coimbatore. While starting operations, the promoters had announced funds infusion to the tune of USD 12 million and plans to have a fleet of three aircraft by October 2016.

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