Lion Mentari Airlines, Indonesia’s biggest private airline, is looking for overseas acquisitions and plans to expand its fleet in an effort to become one of the leading carriers in the region.

Rusdi Kirana, chief executive of the low-cost airline, said the initial target was to acquire or set up airlines in Thailand, Vietnam, Bangladesh and Malaysia.

Lion has also increased its order for Boeing’s 737-900ER from the 100 aircraft previously announced to 122. It has a fleet of 36, including four 737-900ERs.

“Thailand will be first because the airline industry there is much freer than in Malaysia,” he said. “We already have a shortlist of airlines and we hope to complete a deal so we can start flying by August next year. If we can acquire we will, if not we will set up a new airline.”

Lion is mainly a domestic airline, the only international flights being daily runs to Kuala Lumpur and Penang in Malaysia, and Singapore.

The airline is due to launch routes to Ho Chi Minh City in Vietnam in December and to Hong Kong early next year.

Lion, which launched in 2000, was one of the first airlines to take advantage of deregulation in Indonesia’s aviation sector.

There are now dozens of airlines in the country and passenger numbers have soared from 6.3m in 1999 to 34m last year.

The expansion in Indonesia’s airline sector has been at the cost of safety, however, and there have been several accidents, including two big crashes this year.

In July the European Union banned Indonesian airlines from its airspace and recommended its citizens not to fly within the archipelago on safety grounds.

Lion’s last fatal crash, in December 2004, involved an MD-82 aircraft skidding off the runway in Solo, central Java, killing 31 people.

“We don’t want to change our image [as a low-cost carrier] but we are working to improve reliability, boost growth and raise profits,” Mr Rusdi said, citing the acquisition of the new aircraft as a plank in the strategy.

Dudi Sudibyo, the editor of Angkasa, an Indonesian flight magazine, said he was not yet convinced Lion could become a serious competitor to AirAsia of Malaysia or Kingfisher of India.

“They’re not professional enough. They’re still in a learning process,” he said. “They’ll certainly expand but by how much I don’t know.”

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