JAKARTA: PT Lion Mentari Airlines, the Lion Airs operator, plans to step their feet into the market by disposing 30% of stakes merely to raise US$1 billion.President Director of Lion Air, Rusdi Kirana said such corporate action aims to ensure Lions economic stability.By holding this initial public offering [IPO], Lion Airs stakes will not only be owned by Kirana, thus it will be more accountable. The IPO process will be held as the very least by the first quarter of 2013, he said yesterday.He said that the company is optimistic to grab 65% market share in the airlines industry or 60 million passengers by 2012.If our market share reaches 65%, then it will incur particular political power [bargaining power] to us. We also hold this IPO to make the companys responsibility not only born by the Kiranas. The point is the IPO aims to ensure the company for not being collapse.International Air Transport Assocaition (IATA) projects the profit of airlines industry particularly in Asia Pacific to reach US$4.6 billion in 2010 or slumped from 2010s profit projection at US$7.7 billion.Outside Japan, China still leads the growth of such airlines industry in the areas with 6.6% GDP growth.Tiger AirwaysIn South East Asia, Tiger Airways Holdings Ltd happened to be the first low cost carrier (LCC) holding IPO in January 2010 and the first in Asia during the last five years. The Singapore Airlines subsidiary targeted US$196 million from this corporate action.Afterwards, Cebu Air Inc, Philippines held the same corporate action. The airlines company belonging to JG Summit Holding Corp conglomeration began to list its stock in October 2010 and raised US$61 million.Regarding the fund utilization, Rusdi said that the US$1 billion will not be used to develop the company as it will be allocated as the reserves.As previously known, Lion shall hire around 10,000 employees in the future.We will ensure the companys stability; one of the measures is through IPO. Besides, if Lion becomes a listed company, Lion shall become more accountable, he said.In 2007, Lion Air ordered 187 units of Boeing 737-900 Extended Ranger (ER). 43 units of planes have been delivered until now. T02This year, the Indonesias private airlines plans to bring 22 units more. (T02/NOM)
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