Wednesday, February 21, 2007

Hard landing for Adam Air

It's a blessing in disguise for Texas Pacific Group that the family who owns Adam Air rejected the US-based investment firm's offer to purchase some shares late last year. I heard the family rejected the offer after a US investment bank advised the family to sell the shares through initial public offering (IPO) instead.

After the tragic Adam Air flight 574 that killed about 100 people, today the airline's flight KI 172 slipped at Juanda Airport, Surabaya. On board were 148 passengers. Lucky that the hard landing didn't cause serious physical injuries, even though we can't discount the mental stress.
While there is no definitive explanation on the incident, Adam Air lightly explain that the aircraft isn't broken apart, only shrinked.
Government responded the incident with immediate call to suspend the operation of all Adam Air's Boeing 737-300 (seven units). Some even urge governmen to permanently revoke Adam Air's license.
I'm not sure whether the family would move ahead with the planned IPO this year. Shortly after the 574 accident, Adam Air firmly stated its intention to proceed with the IPO in Jakarta and Singapore stock exchanges to float up to 20% shares to finance 10 new aircrafts.




Blogger QURIC said...

It escapes me why anyone in their right mind would enter the airline industry.

As for Adam Air, I guess their exit strategy was to sell it to a private equity like Texas Pacific (which they rejected) or sell out through an IPO.

After what happened today, I think the fate of their IPO will be similar to either one of their two planes: gone missing or crack landing.

Read more:

February 22, 2007 5:04 AM  
Anonymous Anonymous said...

adam air and disaster seems to be closely connected! i think the government should really revoke their license! statistic says that flying is one of the safest way to travel, i guess its not true for adam air! not only they should suspense their license for good, but also the government should really fixed the regulation! it should be hard to start an airline business, cuz it involve the safety of the people

February 22, 2007 6:10 AM  
Anonymous Anonymous said...

With a 25 year old (or something) CEO, would you trust your life with him?

February 22, 2007 12:35 PM  
Anonymous Anonymous said...

No need for the government to ground adam air - the adam air team are doing a pretty good job grounding themselves.

February 22, 2007 1:09 PM  
Anonymous Anonymous said...

They should change their names to DeadAir, with the tagline: Your fastest way straight to hell.

February 22, 2007 7:50 PM  
Anonymous Anonymous said...

Too many entrepreneurs in our country think they just need to get stolen photocopy list of basic ingredients (plane, pilot, mechanic, hostess, fuel, ticket etc), easy favour licence from politician, some help from dubious friends and relatives to fill key management position and then supporting loan from greedy bankers, then hey presto you have create a licence to make money.

Maybe this business model work well for Kebun, Taman, plantation, Ruko or Kaki-Lima?

But where risks are high such as in Airline, to create successful and technically competent businesses we need many years to grow and develop. Additionally they need discipline and care to maintain very high standards.

February 23, 2007 9:37 AM  
Anonymous Anonymous said...

This is what happen when licenses and regulations can be "bought" in our lovely country.

Would suggest that not only the management and investor of Adam Air that needs to be formally questioned, but also those civil servants and regulators that has been "granting" licenses also needs to be questioned.

"Power of Gravity is applicable to anything that can and could fall in this planet"

February 26, 2007 3:41 PM  
Anonymous Anonymous said...

I see Adam air painted the brokenback plane white to avoid any more red face.

Why did government official let them tampering with this 'evidence' still under investigation?

February 27, 2007 9:04 AM  
Anonymous Anonymous said...

Power of gravity unfortunately not helping Lapindo keep the mud in the ground.

February 27, 2007 9:06 AM  

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