Jet Airways confirms stake sale talks with Etihad
4 Jan 2013 5:32 AM IST
The first investment by a foreign carrier in an Indian airline could be on the anvil with Jet Airways on Thursday announcing it was in talks with Abu Dhabi-based carrier Etihad for a possible stake sale.
'Jet and Etihad are in a discussion regarding a potential investment by the latter in the former... these discussions have commenced recently pursuant to the liberalised FDI policy which permitted foreign investment in the shares of an Indian airline,' Jet Airways informed the Bombay Stock Exchange.
'The discussions are in progress but no terms have been firmed up at present. Various structures are being explored by the legal and commercial teams,' it said in its filing. Following the statement, shares of Jet Airways rose sharply by about seven per cent to Rs 618.70.
This is the first time that Jet has admitted holding talks with Etihad for potential investment since the FDI policy was amended by the government in September 2012 to allow foreign airlines pick up upto 49 per cent equity in an Indian carrier. Both airlines are learnt to have appointed global consultants as they want the investments to be on a sound footing, given the high operating costs in India, with reports saying the Gulf carrier's Board would meet soon to decide on the matter.
Jet said it had not yet sought any regulatory approval as a deal with Etihad was still to be firmed up. An appropriate announcement would be made upon finalisation of the terms of the investment with Etihad as per legal and regulatory requirements, the BSE filing added.
When contacted, Etihad spokesperson Thomas Clarke said: 'Our position (on the issue) remains the same as we have stated earlier.'
Sources said that apart from stake sale, Jet and Etihad are expected to have a marketing agreement along with sharing of some flying slots under the air traffic rights.
SCRIP SOARS NEARLY 7% ON DEAL TALK
Shares of Jet Airways on Thursday rose by as much as 7 per cent amid growing expectations of a possible deal between the airline and United Arab Emirates’ Etihad Airways for stake sale. After a positive opening, shares of the company further gained 6.74 per cent to Rs 618.70 on the BSE. At NSE, the stock shot up by 6.17 per cent to Rs 615.65.
'Jet and Etihad are in a discussion regarding a potential investment by the latter in the former... these discussions have commenced recently pursuant to the liberalised FDI policy which permitted foreign investment in the shares of an Indian airline,' Jet Airways informed the Bombay Stock Exchange.
'The discussions are in progress but no terms have been firmed up at present. Various structures are being explored by the legal and commercial teams,' it said in its filing. Following the statement, shares of Jet Airways rose sharply by about seven per cent to Rs 618.70.
This is the first time that Jet has admitted holding talks with Etihad for potential investment since the FDI policy was amended by the government in September 2012 to allow foreign airlines pick up upto 49 per cent equity in an Indian carrier. Both airlines are learnt to have appointed global consultants as they want the investments to be on a sound footing, given the high operating costs in India, with reports saying the Gulf carrier's Board would meet soon to decide on the matter.
Jet said it had not yet sought any regulatory approval as a deal with Etihad was still to be firmed up. An appropriate announcement would be made upon finalisation of the terms of the investment with Etihad as per legal and regulatory requirements, the BSE filing added.
When contacted, Etihad spokesperson Thomas Clarke said: 'Our position (on the issue) remains the same as we have stated earlier.'
Sources said that apart from stake sale, Jet and Etihad are expected to have a marketing agreement along with sharing of some flying slots under the air traffic rights.
SCRIP SOARS NEARLY 7% ON DEAL TALK
Shares of Jet Airways on Thursday rose by as much as 7 per cent amid growing expectations of a possible deal between the airline and United Arab Emirates’ Etihad Airways for stake sale. After a positive opening, shares of the company further gained 6.74 per cent to Rs 618.70 on the BSE. At NSE, the stock shot up by 6.17 per cent to Rs 615.65.
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