AirAsia has entered into an agreement to acquire PT Metro Batavia, which operates the Indonesian airline Batavia Air and aviation training school, Aero Flyer Institute (AFI).
The deal, which was signed in Jakarta today, will see AirAsia take a 49% stake in Metro Batavia Group, with the remaining 51% held by the low-cost carrier’s Indonesian partner, Fersindo. Fersindo is also the majority shareholder of Indonesia AirAsia. The deal for Metro Batavia is worth US$80 million and is expected to be completed by second quarter of 2013.
This acquisition will support AirAsia’s growth in Indonesia, where it recently set up its regional headquarters. Batavia Air currently operates a fleet of 33 aircraft on 41 domestic routes, as well as several international routes to China, Singapore, Malaysia and East Timor and annual charter flights to Saudi Arabia catering for pilgrimage traffic. The combined Batavia Air-Indonesia AirAsia operation will serve 42 domestic and 12 international destinations.
“The Batavia Air acquisition is a fantastic opportunity for AirAsia to accelerate our growth plans in one of the most exciting aviation markets in Asia and further underlines our belief in the growth potential of Indonesia’s aviation sector,” said Tony Fernandes, Group CEO of AirAsia.
Commenting on the sale of the airline, Batavia’s founder Bapak Yudiawan Tansari said; “I am proud to have built Batavia Air into a leading Indonesian airline from its humble beginnings. Recent developments in the airline industry have made me recognise that Batavia Air requires greater scale in order to compete and grow further, and I am so pleased that AirAsia will now take Batavia Air to even greater heights.”
Indonesia’s commercial aviation sector has experienced double-digit growth in recent years. The country’s passenger traffic surged 15% to 66 million in 2011, and airports are being expanded across the country to cater for the expected surge in traffic in years to come.
