Deal closer after Etihad team, Jet chief meet Ajit Singh
31 January 2013
A stake purchase in Jet Airways by Abu Dhabi's Etihad Airways appeared around the corner today, as a delegation from Etihad Airways met civil aviation Minister Ajit Singh, with Jet chairman Naresh Goyal present. The Etihad side was led by the airline's chief executive officer, James Hogan.
"Looking at the aviation sector, it's a good move that Jet and Etihad are talking ... once they sign the agreement, they will go through the regulatory environment. They have been discussing the deal for more than a month. I hope they have discussed all aspects ... I don't see any problems," Singh told newspersons after the meeting.
Goyal said he was not sure when the deal would go through.
The delegation later briefed commerce and industries minister Anand Sharma about their plans in India in the wake of a liberalisation of the foreign direct investment rules for airlinesregime in the aviation sector.
"We have put in place an enabling policy and any investment under the policy is welcome," Sharma said. Late last year, the government decided to allow foreign airlines to buy a stake of up to 49 per cent in Indian ones.
The Gulf carrier has reportedly valued Jet's equity at $1.25 billion, which means the deal may happen at Rs760 per share, sources told NDTV Profit. Etihad is likely to pick up a stake in Jet via a mix of equity and warrants, the sources added.
Etihad and Jet have a code-sharing agreement, and a tie-up could make Jet a more formidable competitor to state-owned Air India, while strengthening Etihad's position against Dubai-based Emirates Airline, which carries a big chunk of the traffic between India and the Middle East.