Mergers, Acquisitions, Alliances and Synergies Case Study

Case Title:

Indian Billionaire Vijay Mallya and Epic Aircraft – A Strategic Partnership

Abstract:
Post September 11th 2001 terrorist attacks in US, the demand of Very Light Jets (VLJs) has been growing steadily, as business travellers did not prefer wasting time behind strict check in formalities. Worldwide, the demand for small aircraft was also increasing because of increase in corporate profits, personal wealth, booming in stock markets and innovation in aircraft technology. US-based Epic Aircraft (Epic), a subsidiary of Aircraft Investor Resource LLC – manufactures small private and business jet aircraft. With India emerging as one of the potential markets in the aviation business, on September 28th 2007, Epic entered into strategic partnership with Indian billionare, Vijay Mallya (Mallya). Mallya acquired 50% stake in Epic Aircraft with a personal investment worth $200 million. Despite the aircraft manufacturing industry indicating a boom for the manufacturing of small jet aircraft, it still remained a question if it will be able to fuel the demand in this segment.

Pedagogical Objectives:

• To understand the concept of strategic partnerships as a key to business expansion
• To analyse the potential for small aircraft manufacturing industry in developing markets like India
• To discuss the growth drivers and demand factors of VLJs in India
• To understand the pros and cons of strategic alliances
• To deliberate the discussion on who gains in such strategic alliances and their feasibility in the long run.

Keywords :  Aircraft Manufacturing Industry; Very Light Jets (VLJs); Mergers,Acquisitions,Alliances Case Study; Small Aircraft; Epic Aircraft; Indian Aviation Market; Kingfisher Airlines; Strategic Partnership; Vijay Mallya; Demand for Small Aircraft; Business Jets; Innovation in Aircraft Technology; Low Cost Carriers (LCCs); Competition