Vijay Mallya's UB Holdings is in talks with banks and financial institutions to raise funds for financing the Air Deccan stake acquisition. Last week, Vijay Mallya's UB Holdings agreed to pick up a 26% stake in Air Deccan for Rs 550 crore.
However, UB does not have enough cash reserves to fund the acquisition on its own. According to reports, even before the Air Deccan stake acquisition was tied up, UB had started talks with potential private equity investors who will be able to bring in funds in return for a stake in the airline.
United Breweries will need more than the agreed Rs 550 crore to acquire Air Deccan. As per stock market regulations, UB Holdings has to make an open offer for shareholders of Air Deccan for a 20% stake. If the offer is fully subscribed, UB Holdings will have to face another cash outflow of a couple of hundred crores of rupees.
There have been recent market reports about the Reliance Anil Dhirubhai Ambani Group buying a stake in Air Deccan. Even after Vijay Mallya's UB Holdings acquired Deccan Aviation, the rumors persisted that Reliance may still join in. However, UB financial wizard Ravi Nedungadi has denied the rumors.
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However, UB does not have enough cash reserves to fund the acquisition on its own. According to reports, even before the Air Deccan stake acquisition was tied up, UB had started talks with potential private equity investors who will be able to bring in funds in return for a stake in the airline.
United Breweries will need more than the agreed Rs 550 crore to acquire Air Deccan. As per stock market regulations, UB Holdings has to make an open offer for shareholders of Air Deccan for a 20% stake. If the offer is fully subscribed, UB Holdings will have to face another cash outflow of a couple of hundred crores of rupees.
There have been recent market reports about the Reliance Anil Dhirubhai Ambani Group buying a stake in Air Deccan. Even after Vijay Mallya's UB Holdings acquired Deccan Aviation, the rumors persisted that Reliance may still join in. However, UB financial wizard Ravi Nedungadi has denied the rumors.
Discuss
Add this link to...
Tell a friend
Bury
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