'AirAsia Indonesia to pick IPO bankers'

>> Tuesday, February 22, 2011

AirAsia Bhd, Southeast Asia’s biggest budget carrier, will appoint bankers next week to manage its Indonesian unit’s initial public offering as it seeks funds for expansion.

The Jakarta IPO is expected to take place in the fourth quarter, Chief Executive Officer Tony Fernandes said in an e- mailed response to Bloomberg News questions today.

The amount to be raised by the unit, which has 20 planes, is still being decided, he said.

AirAsia also intends to hold an IPO for its Thai unit to help fund growth plans, including a possible order for 175 of Airbus SAS’s revamped A320s. PT Garuda Indonesia, the nation’s biggest carrier, Singapore-based Tiger Airways Holdings Ltd. and Cebu City, Philippines-based Cebu Air Inc. have also held IPOs since the beginning of 2010 as rising stock markets and growing travel lure investors. - Bloomberg

Business is “excellent,” Fernandes said. The airline, based in Sepang, Malaysia, is “very happy with results.” Fourth-quarter earnings are due to be reported on Feb. 24.

AirAsia Indonesia plans to raise funds so it can own its own planes, which will help pare the parent company’s debt-to- equity ratios, Fernandes said. The Indonesia arm may surpass the Malaysian operations, which are more than three times as big, in the “not-too-distant future,” Fernandes said in November.

AirAsia was unchanged at 2.76 ringgit as of 12:30 trading break in Kuala Lumpur. The stock has risen 9.1 percent this year, while the FTSE Bursa Malaysia KLCI Index is little changed.

The company may post a profit of 224.4 million ringgit ($74 million) in the quarter ended in December, according to the average of four analyst estimates compiled by Bloomberg. The carrier posted a net income of 76.7 million ringgit a year earlier, according to Bloomberg data. - Bloomberg



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