Singapore’s Tiger Airways and Indonesian strategic investment company Saratoga Group have stepped in to save Indonesia’s floundering Mandala Airlines, Tiger Airways announced on the Singapore Stock Exchange Web site on Thursday.
Tiger said it would assume control the 33 percent of Mandala’s share, with Saratoga Group becoming the main shareholder with 51 percent.
Fifteen percent of the shares will be held by Mandala’s collective creditors, while the shares of former co-owners Cardig International reduced to 1 percent, as agreed by the creditors.
“Mandala’s president director reported to me that they are planning to announce the deal on Friday,” said Herry Bhakti Gumay Singayuda Gumay, director general of civil aviation at the Transportation Ministry.
He confirmed that Mandala had secured two investors, one from Singapore and the other a local company.
According to Tiger’s announcement, Mandala will operate domestic flights based on Tiger’s business plan and will operate Airbus A320 aircraft. Mandala had transferred a number of their pilots to Tiger Airways when the airline suspended operation under a mountain of debt.
Saratoga founder Sandiaga Uno, who confirmed the deal, told the Jakarta Globe that it believed there was strong growth potential in the Indonesian aviation sector “due to robust economic growth and Indonesia’s characteristic as an archepeligo.”
“By partnering with Tiger Airways, an established Asian low-cost carrier, the new Mandala will be able to leverage on Tiger’s existing infrastructure, resume flying quickly and offer reliable and affordable services to its customers.”