AdamAir may sell 20 percent stake to Australia's Qantas

Saturday, February 04, 2006

The Jakarta Post, Jakarta

Locally owned regional airline AdamAir is considering selling about 20 percent of its shares to Australia's Qantas in a bid to create mutual benefits for both airlines.

"They want to buy about 30 percent of our shares, but we are only prepared to offer them 20 percent as we're planning to sell another 20 percent during an initial public offering (IPO) in Singapore next year," Adam Air chief executive officer (CEO) Gunawan Suherman was quoted by Antara as saying Friday.

He added, however, that the Qantas deal had not yet been finalized.

Qantas CEO, Geoff Dixon, and the airline's chief financial officer, Peter Gregg, visited Soekarno-Hatta Airport in Jakarta on Friday to take a closer look at AdamAir's operations.

The Australian airline, Gunawan said, had decided to make Indonesia its second hub after Australia.

"They are preparing to enter the domestic market before the Association of Southeast Asian Nations (ASEAN) liberalizes the transportation of cargo in 2008 and passengers in 2010," he said, adding that he expected the deal would benefit both companies.

Qantas, he said, would also provide training for AdamAir employees.

AdamAir, one of Indonesia's fledgling budget airlines, plans to almost triple the size of its fleet to 50 aircraft within three years to support the expansion of its domestic and international services.

The airline currently operates 20 planes, flying to 39 destinations, including Malaysia and Singapore.

"We are hoping to operate 40 planes by the end of 2006," executive vice president Dave Laksono told The Jakarta Post last week.

The airline started its domestic operations in December 2002 with Boeing 747-400 and Boeing 737-500 aircraft made between 1997 and 2000.

Qantas, which stands for Queensland and Northern Territory Aerial Services Limited, was founded in Queensland in 1920.

It is widely regarded as one of the world's leading long distance airlines and one of the strongest brands in Australia. (01)