Report: Akasa Air Sees $75-100 Million in New Equity, Which Could Dilute Jhunjhunwala Family’s Interest
Akasa Air, which was financed by the late billionaire Rakesh Jhunjhunwala, is apparently aiming to raise $75–100 million via new stock. According to recent developments, Akasa Air intends to grow its company by issuing these new shares.
The Economic Times said that Akasa Air will use the money to pay for its fleet’s pre-delivery expenses. The purpose of this is to grow the airline industry in India, where aviation is rapidly developing.
According to the article, Akasa Air had previously ordered 72 Boeing 737 Max aircraft, and 19 of them had already been delivered in accordance with the contract. The airline apparently also contacted high net worth people, PE firms, and possible investors for this operation.
According to the magazine, “the capital infusion is based on a $650 million valuation for the airline.”
Currently, it is said that the US-based hedge fund PAR Capital Management owns around 6% of the airlines supported by Jhunjhunwala. The article notes that there is a chance that this hedge fund would buy additional shares since the corporation currently has a stake in it.
The Jhunjhunwala family’s interest may wind up being diminished by the financing, which will aim to increase and develop operations. Through a trust, the family now controls around 46% of Akasa Air.
“The trust is unlikely to take part in this round of investment, but it will still own a sizeable share even after the dilution. The value of Akasa, which has excellent financials and is managed by specialists, would only increase, a source was cited as saying in the magazine.
