Garuda Indonesia wants to maintain full-ownership of its maintenance, repair and overhaul (MRO) business GMF AeroAsia but is open to having strategic investors come in to invest in certain parts of GMF AeroAsia.
The national carrier's president Emirsyah Satar confirms that GMF AeroAsia wants the carrier to inject money into its business to help fund the construction of new maintenance hangars.
GMF wants to add two hangars so it can do more heavy maintenance work for third party customers.
Satar says Garuda did look at having an initial public offering for GMF AeroAsia but decided against it because Garuda is planning to have an IPO of its own in mid-2010.
Under Indonesian law a parent company is forbidden from having an IPO for a subsidiary if the parent company plans to have an IPO of its own, says Satar.
He also says Garuda is reluctant to sell equity in GMF because it is generating good profits for the airline.
Satar says if GMF wants to get investment to build hangars, one option might be for GMF to set up a joint-venture company that is responsible for that asset and the resulting revenues.
GMF already has MTU Aero Engines as a partner on maintenance, repair and overhaul of CFM56-3 engines.
Garuda is open to GMF having stakeholders in certain divisions but the company, GMF itself, must remain wholly-owned by Garuda, says Satar.