NRI unit to buy 20% in Deccan Aviation

The Bangalore-based Deccan Aviation Pvt Ltd, which operates short distance flights between cities in the southern parts of the country, is getting investments from Golden Ventures Ltd, a NRI venture, to fund its countrywide expansion.

The NRI group will pick up 20 per cent shareholding in the company for a consideration of Rs 18 crore, of which Rs 2.6 crore is equity, while the balance is the premium on the shares issued.

The local promoters are also infusing close to Rs 7.12 crore into the equity of the company. But their shareholding will come down from 85 per cent to 68.45 per cent in the expanded capital.

The shareholding of the only foreign shareholder Kenichi Miyagawa will stand reduced from 15 per cent to 11.55 per cent. His equity investment is also increasing from Rs 31 lakh to Rs 1.5 crore.

The company's total paid up capital will increase from Rs 2.08 crore to around Rs 13 crore. Deccan Aviation has already approached the government for regulatory approvals. Government sources said Golden Ventures is based in Mauritius.

Deccan Aviation managing director Capt. G R Gopinath declined to give details about the investments and the premium the fresh issue of shares fetched.

He, however, confirmed that the NRI group was investing in the company. "They approached us. We will use the money for expansion," he said. He added that Miyagawa has been an investor in Deccan Aviation since its inception.

Gopinath added that the airline was going on an expansion spree in the new year by taking operations from the current 25 flights a day to 30. Next week the airline will launch its Mumbai-Goa and Mumbai-Belgaum flights.