India’s Deccan and Kingfisher airlines to merge

BANGALORE, India, Dec 20, 2007 (AFP) – India’s biggest discount carrier, Deccan, will merge with liquor baron Vijay Mallya’s upmarket Kingfisher Airlines to create the nation’s biggest domestic airline, officials said. The firm formed by the merger next year will keep the name Kingfisher, the flagship beer brand of Mallya’s UB Group, officials from the two carriers said after a four-hour meeting late Wednesday.

“The merger will bring about synergies across the board and lower the cost of operating both the airlines,” Deccan founder G.R. Gopinath told a press conference in this southern Indian city where his airline is based.

A merger would marry two airlines that had seemed unlikely bedfellows, with Gopinath earlier this year likening the flamboyant Mallya to someone from Venus and himself to a Martian who would never be able to do a deal.

That was before he sold a 26 percent stake in June to UB Group, accepting a 5.5-billion-rupee (139-million-dollar) lifeline to keep his fleet in the skies as Deccan Aviation reeled under heavy losses.

“Like politics, business is the art of the possible,” said Gopinath, a first-generation entrepreneur who founded Deccan in 2003.

Both Deccan and Kingfisher, whi