According to India's Mint outlet, Akasa Air (QP, Mumbai International) is trying to fund up to USD400 million, diluting the shareholding of its key existing shareholders in the process.
Unnamed person familiar with the situation informed the newspaper that "The fundraising will be done in several installments, with valuations rising from the current USD650 million to up to USD1 billion. The planned new stock issuances may cause the Jhunjhunwala family's stake to become less significant because they are unlikely to purchase any additional shares."
Ownership of the airline is held by that family, whose now-deceased patriarch Rakesh Jhunjhunwala launched Akasa in 2021. Vinay Dube, the CEO, holds a 16.13% stake in the company, followed by Madhav Bhatkuly (9.41%), Sanjay Dube (7.59%), Niraj Dube (7.59%), and PAR Capital Ventures Llc (6.37%).
With a fleet of 19 B737-8 aircraft and one B737-8-200, Akasa Air travels to 16 locations in India. A representative for Akasa said that the airline had made money right away and that the initial investments made by the Jhunjhunwalas and others were still present in the company's bank accounts. The spokeswoman stated, "As a young airline, we are delighted that we are increasing the business reserves even in the first year of our operations.
Separately, just as Akasa has received approval from India's Ministry of Civil Aviation to operate international flights, it has experienced an exodus of pilots, with 43 leaving before their contracted employment periods expired, causing the airline to take them to court for contract breaches and cancel hundreds of flights. Reportedly, Akasa will cancel up to 700 flights across September if they cannot stem the tide of resignations. Last week, in an internal staff email, Akasa's CEO said he would give up market share to stabilise operations. However, Dube denied speculation Akasa would suspend all flights due to pilot shortages.
First officers are required to give employers six months' notice under Directorate General of Civil Aviation (DGCA) regulations, and captains are required to give employers twelve.
By Hilda Annah|thetransporteronline24|Ghana
