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19 April 2024

Etihad-Jet Airways deal likely in next 12 days

By Staff

Abu Dhabi-based Etihad Airways might announce an India investment within the next 10 to 12 days, according Indian media reports.

The Gulf carrier is expected to pick up 24 per cent stake in Jet Airways for about Rs16 billion to Rs18 billion, a government official told the Financial Express, adding the deal can be sealed in the next 10-12 days.

Quoting a ministry source, The Economic Times reported: "James Hogan, Etihad's CEO and the person who is widely believed to be driving the negotiations, is on leave till January 4 and things would move once he is back in action.”

The source added: "A deal is possible within next 10 days, there are a number of agreements to be signed as part of it.”

On Wednesday, a senior government source told Reuters that Jet was the “front-runner” for an investment by Etihad.

According to the government official, for the deal to go through Jet would have to approach the Foreign Investment Promotion Board to change its shareholding pattern. Jet chairman Naresh Goyal holds 80 per cent stake in the carrier through an overseas corporate body, Tail Winds, which is registered in the Isle of Man, while public shareholders hold the remaining stake.

If the deal does happen it would be the first after the government in September 2012 permitted foreign airlines to pick up to 49 per cent in a domestic airline.

The Abu Dhabi-based airline has previously stated: "Etihad Airways has identified equity investments in other airlines as an important evolution of its successful partnership strategy.

"The Indian aviation industry offers tremendous potential, with significant passenger movement on domestic and international sectors.

If or when we do make further investments of this sort, we will announce them in line with regulatory and commercial requirements," it added.

Jet Airways in talks with Etihad about stake sale

Loss-making private Indian carrier Jet Airways said on Thursday that it was in talks with Etihad Airways about selling a stake to the Abu Dhabi-based airline.

"These discussions are in progress but no terms have been firmed up at present," Jet said in a statement to the Bombay Stock Exchange.

The airline said an "appropriate announcement" would be made once the terms of the investment by Etihad were finalised.