Garuda's IPO debuted on the Indonesia Stock Exchange on 10-Feb-2011 (The Jakarta Globe, 10-Feb-2011). President director of state brokerage firm and lead underwriter Danareksa Sekuritas, Marciano Herman, stated: “Garuda’s IPO went smoothly according to our plan and procedures. It is successful by our own standards.” Bahana would absorb USD33.6 million and Danareksa would absorb USD22.4 million, while Mandiri Sekuritas was successful in selling its shares as it deals with a number of institutional investors. Foreign agents UBS and Citigroup reportedly failed to sell most of the shares set aside for foreign investors. Total proceeds from the IPO are expected to be USD532 million, though reports said the total default order would be approximately USD58 million.
Garuda's IPO debut was 'smooth'
You may also be interested in the following articles...
Turbulence will hurt Southeast Asia’s airlines in 2017 as overcapacity bites
Southeast Asia is a region with enormous growth potential but a relatively cloudy outlook for airlines given the intense competition and overcapacity concerns. Demand is on the rise, boosted by a growing middle class, rising discretionary incomes and relatively strong economies.
Indigo Partners assesses ultra-low cost airline (ULCC) investment opportunities in Southeast Asia
US airline investment firm Indigo Partners is assessing new low cost airline investment opportunities in Asia with a focus on the ultra-LCC or ULCC model. Indigo has not had an investment in Asia since selling its stake in Singapore-based Tigerair five years ago, but currently has large stakes in LCCs based in Europe and North America.
Indigo believes there could be room for a ULCC in the Southeast Asian market despite already intense competition and a huge LCC order book, because the LCCs now operating in this region are not true to the LCC model. Several Southeast Asian LCCs, including Tigerair, are owned by full service airline groups, leading to a dilution of the typical LCC model.
India is also a market of interest for Indigo. However, the firm is not interested in North Asia at this point, despite that region's much lower LCC penetration rate. Australia is also not of interest as it is already mature.