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ational flag carrier PT Garuda Indonesia (GIAA) is preparing to float its two subsidiaries’ shares on the Indonesia Stock Exchange (IDX) as part of the airline’s “quantum leap” master plan to expand business.

Garuda president director Emirsyah Satar said on Wednesday that either travel and catering provider PT Aerowisata or aircraft maintenance unit PT Garuda Maintenance Facility Aero Asia (GMF) would be ready for an initial public offering (IPO) before the end of this year at the soonest, or during the first quarter of next year.

“GMF is ready for an IPO, but the question is when is the best timing to get the optimum value. For that, we are in the process of appointing a financial advisor,” he told a press briefing at the IDX’s 2012 Investor Day. Garuda will select the advisor in the next two weeks.

Emirsyah said the proceeds expected from the initial shares offer, and the amount of shares to be off-loaded, would be estimated next month after talks with the financial advisor.

Aerowisata had US$198 million assets and GMF had $151 million as of the end of December.

“Going public is not always aimed at raising funds, but for transparency. The company’s performance will be improved. Money is important but governance is also important,” Emirsyah said.

Governance is key for Garuda’s “quantum leap” expansion plan, he added, which is expected to see the airline nearly double its number of aircraft within five years and increase by half its destinations by 2014.

“Garuda is growing and therefore we need to also expand in order to handle Garuda’s growing fleet. We need to increase our maintenance facilities,” GMF Aero Asia president director Richard Budihadianto said, citing plans to build two hangars in the next three years — one in Cengkareng, West Jakarta and the other in Makassar, Sulawesi.

GMF Aero Asia will need $100 million to start building the Cengkareng hangar this year, which will be funded by its parent company as well as through bank loans. Garuda still had more than Rp 1 trillion in proceeds from its 2011 IPO to be used for the company’s and its subsidiaries’ expansion.

GMF Aero Asia saw revenues grow by 7.5 percent to Rp 1.63 trillion, with comprehensive profit growing 93 percent to Rp 54.8 billion.

Aerowisata booked Rp 2.01 trillion in revenues last year, a 26 percent increase from a year earlier, with comprehensive profits growing by 66.3 percent to Rp 70 billion.

“Aerowisata had an average growth of 17 percent in the past few years and so we expect our business to grow between 14 and 17 percent this year,” Aerowisata director Alex Maneklaran said.

Garuda recently spun off its low-cost carrier business unit to become a subsidiary called PT Garuda
Indonesia Citilink, which is also encouraged by the parent company’s plan to offer initial shares to the public.

Garuda has three subsidiaries other than Citilink, Aerowisata and GMF Aero Asia, which all support the company’s business, comprising computer reservation provider PT Abacus Distribution Systems Indonesia, ground handling service firm PT Gapura Angkasa and information technology provider PT Aero Systems Indonesia.