Kingfisher Airlines to take over Air Deccan: Rumours start afresh

Bangalore: Rumours are once again rife that Vijay Mallya led Kingfisher Airlines may be picking up low cost carrier, Air Deccan, after all. Market rumours would have it that the two groups are currently in an advanced stage of talks and are expected to make an announcement soon. Capt GR Gopinath, CEO of Air Deccan, however, has denied that any deal is being discussed with Kingfisher.

If a deal should materialize, Kingfisher Airlines would then become the largest aviation player in the country by market share.

According to reports, senior Kingfisher Airlines officials have said that the two airlines would be run separately; wherein Air Deccan will retain its low-cost status and Kingfisher would operate as a full-service airline. On the face of it, this would appear to be an important concession to Air Deccan's Capt Gopinath, who has gone on record to say that he would like to run the airline, even after its acquisition by any Group.

Capt Gopinath has also, time and again, sworn by the LCC business model, even as other operators in the country have doubted the cost efficacy of the model.

The airline industry has seen a growth of nearly 20% in the last five years, primarily led by low-cost carriers, who have steadily taken away market share from full service carriers like Jet Airways, Indian Airlines and Kingfisher.