Jet sells 24 per cent equity to Etihad

Jet Airways and Etihad on Wednesday announced closure of a Rs. 2,069 crore deal for the Abu Dhabi-based carrier to pick up 24 per cent equity in the Indian airline, marking the first FDI infusion by an airline in the Indian aviation sector.

Maintaining that all requisite regulatory approvals from Indian authorities have been obtained on November 12, the two airlines said Jet has “issued and allotted 27,263,372 equity shares of a face value of Rs. 10 each at a price of Rs. 754.7361607 per equity share on a preferential basis to Etihad Airways.”

Following the allotment of equity shares on preferential basis to Etihad Airways, Etihad Airways holds 24 per cent of the post-issue paid up share capital of Jet Airways “on a fully diluted basis”.

As per legal requirements, 51 per cent stake would be held by Jet and its Chairman and promoter Naresh Goyal.

In a statement, the two carriers also announced that Etihad President and CEO James Hogan and its Chief Financial Officer have been appointed as additional directors on the board of directors of Jet from Wednesday.

The announcement came shortly after a Jet Board meeting in Mumbai on Wednesday.

Mr Goyal and Mr. Hogan said “the collaboration between the airlines would commence immediately with a view to delivering network and service benefits to customers as soon as possible.

Specific details will be released progressively.”

The Jet stake sale deal is the first of its kind in an Indian airline. The announcements by Malaysian carrier AirAsia to set up AirAsia India and by Singapore Airlines to set up a joint venture airline with Tata Sons, are yet to fructify.