(MENAFN) Malaysia-listed Air Asia has cancelled an USD80 million deal to acquire Indonesia's Batavia Air because the move would have induced too many risks, Reuters reported.
In July, Asia's largest economic carrier had unveiled its intention to buy Batavia as part of its strategy to strengthen its position in Southeast Asia's biggest economy.
It would have been AirAsia's first major airline acquisition and would have ratcheted up competition in Indonesia among low-cost carriers such as Lion Air and flag carrier Garuda's Citilink unit.
CEO Tony Fernandes said the group is still interested in Indonesia, adding that they will push through an IPO plan their.
Last year, Fernandes has expressed caution towards acquisitions, calling them "value-destroying".
The two companies will now cooperate on other aspects of the aviation business, including a training joint venture to address an expected skilled pilot shortage in Indonesia, the statement said.
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