Jet-Etihad stake deal gets Cabinet approval

‘Yes, it has been cleared,’ said civil aviation minister Ajit Singh after a meeting of the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Manmohan Singh. Replying to questions, he said the deal has ‘gone through all the regulatory processes’ and would be ‘good for civil aviation and good for the passengers’.

The proposal was of Etihad to subscribe 27,263,372 Jet shares of Rs 10 each, amounting to 24 per cent of post-issue paid-up equity share capital for Rs 2,057.66 crore.

CCEA gave its nod on the conditions that, among other things, Jet and Etihad would adhere to RBI policy guidelines and SEBI regulations, comply with all Indian laws and take prior FIPB approvals for any further changes in the shareholders agreement, commercial cooperation agreement, articles of association, investment agreement and shareholding patterns, the sources said.

The deal has already been cleared by the Securities and Exchange Board of India (Sebi) and the Foreign Investment Promotion Board (FIPB), with the minister saying that approval to the deal was delayed as it had to go through all regulatory processes, including twice to FIPB.

Asked about the ongoing vetting of the deal by the Competition Commission, Singh said, ‘It is a continuing thing. Any time competition related issues come up, they have to look into it.’