Singapore-listed low cost carrier Tiger Airways Holdings said it has signed a deal to buy a 33% equity stake in Indonesia's PT Mandala Airlines. The restructured airline is due to fly soon after the acquisition transaction with Tiger Airways and Indonesian strategic investment firm Saratoga Group was finally closed on Friday.
Debt of Rp 2.45 trillion (US$286.65 million) caused by high lease rates led Mandala to cease operations earlier this year. Eleven leased aircraft have been returned.
Mandala executives concluded conditional sales and purchase agreements and other legal and commercial documents with the Saratoga Group as the financial investor and Tiger Airways as the strategic investor on Friday, September 23, 2011.
Saratoga is now the majority shareholder of Mandala with 51% stake, followed by Tiger’s 33% ownership, while the remaining 16% is owned by the airline’s existing shareholders and concurrent creditors through a debt-to-equity swap mechanism.
Mandala’s new operation will be based on Tiger’s business plan and will use A320 aircraft to offer low-fare travel to international and domestic destinations.
Saratoga Capital Investment manager Devin Wirawan said Mandala would be back in the air 90 days after the acquisition and that Mandala was now carrying out the final restructuring phase: securing an air operator certificate (AOC) from the Transportation Ministry. Stakeholders have not yet decided whether to continue using the brand name “Mandala” or change it to Tiger.
This agreement proves, if nothing else, that there are strategic investors are out there with cash in the bank ready to pounce on the right deal at the right time. Economic turmoil there may be but the aviation sector continues to develop at pace.
Meanwhile, ANA and Boeing have signed the formal documents completing the contractual delivery of the first 787 Dreamliner. Celebrations begin today in Everett with a delivery ceremony followed on Tuesday. The final signing comes after a series of flights, inspections and the transfer of funds.
"Now that the airplane is ready to deliver, the entire team is ready to celebrate," said Scott Fancher, vice president and general manager of the 787 program. "We look forward to honouring our launch customer ANA before they fly their first Dreamliner home to Japan."