Joint venture to invest over US $ 8 m in 'CINNAMON AIR' domestic air taxi service in Sri Lanka

Saffron Aviation (Pvt) Ltd, a joint venture between John Keells Holdings PLC (JKH), MMBL Leisure Holdings (Pvt) Limited and Phoenix Ventures Limited, signed an agreement with the Board of Investment of Sri Lanka to establish a domestic air taxi service in Sri Lanka with an initial investment of USD 6.8 million out of a total planned investment of USD 8.4 million.

The start-up fleet will consist of two Cessna 208 Caravan Amphibian aircraft (seating 9 passengers each) and one wheeled Cessna 208B Grand Caravan aircraft (seating 12 passengers) that would provide the flexibility for the airline to operate from any of the domestic and international airportsas well as from waterdromes in Sri Lanka.

The domestic air taxi service, flying under the brand name 'Cinnamon Air' will fill a critical void in the current tourism offering in Sri Lanka by providing a unique service of scheduled daily flights linking the Bandaranaike International Airport (BIA) with key holiday locations on the South West coast, the East Coast (in the summer season), Kandy, the Cultural Triangle and Hambantota/Yala. Flights to and from the BIA will largely connect with arrival and departure flight timings of the National Carrier and all major international airlines serving Colombo.

The air taxi service will augment the overall visitor experience in Sri Lanka by significantly reducing the time spent by tourists on road transfers between the airport and hotels and on excursions, whilst providing passengers with a unique, panoramic view of the outstanding countryside and scenery.

The service will alsobe an important value addition to and benefit the several investments in upscale boutique hotel properties in the recent past, thus contributing significantly towards attracting high end tourism traffic to Sri Lanka. Whilst scheduled services will be retailed through all Tour Operators and Travel Agents and directly to customers via the internet, Cinnamon Air will also offer short scenic flights and charter flights to any part of the island for groups, cruise passengers and corporate travelers.

Commercial operations of Cinnamon Air are expected to commence in the last quarter of FY 2012. JKH is the largest listed company in the Colombo Stock Exchange with business interests primarily in Transportation, Leisure, Property, Consumer Foods and Retail, Financial Services and Information Technology, among others.

MMBL Leisure Holdings (Pvt) Limited is a fully owned subsidiary of Mercantile Merchant Bank Limited set up to explore investment opportunities of the tourism sector. Phoenix Ventures Limited is an investment holding company that is also the parent company of Brandix Lanka Limited and Phoenix Industries Limited.