Air Pegasus ties up with new investors for ₹20 cr

Air Pegasus, which suspended operations a year ago, has raised funds from a clutch of investors and is set to resume its operations in January.

“We signed an agreement early this month with a Malaysian company to lease an ATR,” the airline’s Managing Director Shyson Thomas told BusinessLine .

Pegasus, which had suspended operations on November 8, 2016 for lack of funds, has been able to rope in investors who were associated with the carrier earlier.

These investors will pump ₹20 crore into the airline for a 60 per cent stake. A first tranche of ₹8 crore has already been disbursed.

The airline will commence operations in the first half of January.

In early March this year, Pegasus tried to revive its operations, tying up with ABC Aviation and Training Services Pvt Ltd-led Flyeasy India, which had promised to invest in the company. But the airline did not receive the funds on time and hence had to abandon the plan.

The airline has now tied up with Dawn Aviation for the funds.

“With the funds in place, the banks have assured us that they will restructure the debt and release more funds for the working capital needs,” Thomas said. Most part of the debt has now been settled, he said.

It has also leased an ATR 72-500 aircraft from US-based Amur Aviation, which will be pressed into service from January. It plans to get two more ATRs next year from Vietnam Airlines. The first ATR is currently parked with Sepang Aircraft Engineering, an MRO based out of Kaula Lampur.

It will undergo a 12-month check in December before being released to Air Pegasus.

Thomas said Pegasus has been able to get the aircraft at a far lesser rate than before. It will pay $115,000 per month as leasing charges to Amur Aviation apart from a three-month deposit. “The rates have come down because the leasing companies have more confidence in the Indian aviation story than before. The Kingfisher Airlines debacle had made the leasing companies wary of airlines in India,” he pointed out.

The leasing companies used to charge $150,000-175,000 per month earlier with a six-month deposit. The promoters of the airline said the regulator, the Director General of Civil Aviation (DGCA), is expected to lift the suspension of AOP (air operator permit) once the aircraft gets inducted into the fleet.

The airline has already written to DGCA saying it will import the nine-year-old 72-seater aircraft. Pegasus’ AOP had been suspended because of lack of aircraft.

The airline expects to fly to Kochi, Madurai, Hubballi and Vijayawada initially.

It already has four sets of pilots and the rest of the cabin crew in place.

“We are also planning to shortly apply for the UDAN scheme,” Thomas said. “It is good to have a mix of regional connectivity and tier two routes.”

Akin to Pegasus, Vijaywada-based Air Costa has also stopped operations because of shortage of funds.

COMMENT NOW