UB Group Chairman Vijay Mallya, on Friday, announced the seat-sharing arrangement between Kingfisher Airlines and the low-cost carrier Air Deccan in the event of any inordinate delay or flight disruptions in services in two air carriers.
Replying to a question at a press conference here, Mr Mallya said that an Air Deccan passenger can now travel on the Kingfisher’s flight  in the event of delay or flight disruptions with the former and this arrangement is reciprocal for Kingfisher airline passengers too.
He also declared that passengers diverted will not have to pay any extra fee for the facility. Mallya’s UB group on Thursday announced a deal to pick up 26 per cent stake in the low cost carrier Deccan Aviation Ltd by paying Rs 550 crore.
Operational synergy
Mr Mallya also claimed that by exploiting various synergies two airlines together will be able to extract Rs 300 crore worth of benefits in a year.
Two airlines will have synergy in the areas of operations & maintenance, ground handling, vastly increased connectivity, feeder services, distribution penetration etc, he explained.
 Now that the UB Group has become the largest single shareholder in Deccan Aviation Ltd., it will be entitled to nominate three directors on the Board. The 12 member board will comprise with three directors from UB Group, three nominated by the original promoters/institutional shareholders and the remaining six will be independent directors. While Mr G R Gopinath will continue as Executive Chairman, a new CEO will be appointed reporting directly to the Board of Directors.
Mr Mallya also pointed out that the new alliance will make the Kingfisher-Air Deccan group the largest domestic airline with a fleet of 71 aircraft including 41 Airbus aircraft and 30 ATR aircraft. It will cover all segments of air travel from low fares to premium fares and offer the maximum number of 537 flights connecting 69 cities in the country.   “We will be covering every price point from premium to low-cost fares with this alliance” said Mr Mallya.
For the near future, Kingfisher will continue to serve the corporate and business travel segment, while Air Deccan will focus on serving the low fare segment but with improved financial prospects for both carriers.   
Shares of both Deccan Aviation and UB Holdings on Friday surged nearly 10 per cent in early morning trade on the BSE.
The scrip of Deccan Aviation jumped Rs 13.80 to touch a high of Rs 160, while United Breweries Holdings jumped Rs 68.35 or 9.99 per cent and touched a high of Rs 752.15.