Air Odisha to dilute stake to Sharjah-based NRI crude oil firm

Bhubaneswar: Scheduled commuter carrier Air Odisha is all set to take a Sharjah-based NRI investor on board as it seeks to tap fresh capital to fuel its expansion plans and the announcement to this effect is likely to be made soon, a source said

The Bhubaneshwar-based airline has also brought in industry veteran Bhupesh Joshi as its chief executive officer ahead of bringing in the new Sharjahbased partner, the source said.

Air Odisha is currently 60 percent owned by two Ahmedabad-headquartered firms --GSEC Aviation-Monarch Networth Capital-- and the rest 40 percent stake is with original promoter Radhakanta Pani family.

"However, GSEC Aviation-Monarch Networth have decided to partially offload their stake to the Sharjah-based crude oil firm Ghalia Petrol LLP. The two partners have already signed the term-sheet and are expected to make an announcement on the deal soon," the source told PTI.

The decision was taken at Air Odisha Pvt Ltd's board meeting held in Bhubaneswar last month, the source added.

The GSEC Aviation-Monarch Networth Capital had acquired 60 percent stake in the carrier from Pani family in November last year along with the acquisition of G R Gopinath-founded Air Deccan.

GSEC Aviation is owned by Rakesh Ramanlal Shah, brother-in-law of Adani Group chairman Gautam Adani.

Air Odisha managing director Shaishav Shah confirmed to PTI that the airline was getting a new investor in addition to the existing promoters to infuse fresh capital, adding that it had already signed an agreement to clinch the deal.

"I can just confirm that we have signed the contract with a Sharjah-based company which is into crude oil trade. We will very soon be making a joint statement on the proposed deal," Shah said.

He, however, refused to divulge other details such as quantum of stake to be diluted or the deal size.

But he said that he will continue as the managing director of Air Odisha even post stake dilution.

The source also said that the airline has appointed industry veteran Joshi as its chief executive officer replacing the incumbent Ashutosh Pani.

"His name has also been proposed for the Accountable Manager position to aviation regulator Directorate General of CiviL Aviation. The DGCA approval is awaited," the source added.

Air Odisha, which started its services as a non- scheduled operator in November 2012, was granted scheduled commuter airline permit by the DGCA to launch flights under the government's regional connectivity scheme (RCS) in February.

It has bagged 50 routes under the first phase of the RCS scheme, announced in March 2016. The airline currently operates on some routes in Gujarat and Odisha.