Reliance ADAG eyeing SpiceJet

06 June 2008

Mumbai: The Anil Dhirubhai Ambani group (ADAG) is reported to have initiated talks to acquire the low-cost domestic airline SpiceJet, say reports, without attributing the information to any source.

Other media report have indicated that Vijay Mallya's Kingfisher Airlines and Jet Airways are also interested in acquiring the low cost domestic airline that has been hit hard on account of rising costs due to spiraling aviation turbine fuel prices, and is looking to raise funds, reported the Mint.

Anil Ambani's group owns and manages Reliance Communications Ltd, the second largest player in the Indian telecom market, which is reported to be in talks for a possible merger with South African telecommunications giant MTN. That acquisition, if it were to happen, would create a global top-10 telecommunications entity.

Spice Jet founder Bhupendra Kansagra has denied  that he was evaluating a dilution of his stake in the airline, though is reported to have said that anyone could consider a dilution at the right price.

Other shareholders in Spice Jet are the Tata group, which owns 6 per cent, and the Dubai government's investment agency Istithmar, which holds 13.4 per cent of the budget airline.

In a filing with the Bombay Stock Exchange, in which the airline has said that it has not received any formal communication from anyone. However, the airlines shares rose the most in a six month period.