The Hindu Business Line : Kotak's IGF picks up 10% stake in Paramount Airways

THE India Growth Fund from Kotak Mahindra Group has picked up 10 per cent stake in Paramount Airways, the Coimbatore-based low cost carrier, according to reliable sources.

Bennett, Coleman & Company Ltd has also picked up a minority stake.

According to the sources, the deal with Kotak works out to $15 million (about Rs 70 crore). The airline has been valued at about $150 million (about Rs 685 crore). The promoters - Madurai-based Paramount group - have issued fresh shares and they will hold a 90-per cent stake in the airline after this deal.

The sources said a number of private equity investors were interested in the airline and the promoters decided on Kotak Mahindra considering its track record, especially in lead managing IPOs.

The airline has been set up by the Madurai-based Paramount group, which is into textiles, at an investment of Rs 600 crore. It now has one Embraer 170 aircraft in a 70-seat all business class configuration. It operates daily flights connecting Coimbatore to Chennai, Kochi and Delhi. It started commercial operations on October 19.

The airline plans to add 15 Embraer aircraft to its fleet.

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