MUMBAI: Gulf carrier Etihad Airways, which is
tipped to pick 24% stake in India's second-largest airline Jet AirwaysBSE 0.15 %, said
on Monday that it will complete its due diligence on the Indian company by next
week.
Addressing the global media through a webcast after posting a 200% jump in its net profit for 2012 to $42 million, James Hogan, president and CEO of the Middle East carrier, said, "We will present the deal to our board and then take a view (on the investment)." He, however, refused to take any more questions on the deal. While there are no specific details on the contours of the deal yet, it is believed that Etihad might pay close to Rs1,800 crore for a 24% stake.
Also, a Jet official has told ET that if all goes well, it might take at least a week or up to 10 days for the deal to be sealed, indicating a possible mid-February announcement.
ET had first reported about a possible deal between Jet and Etihad in September 2012, soon after the sector was thrown open to investment by foreign carriers last year by the civil aviation ministry. And if the Jet-Etihad deal goes through, it will be the first investment by a foreign carrier in an Indian airline. Some top executives of Etihad visited India last week and met civil aviation minister Ajit Singh, commerce minister Anand Sharma and finance minster P Chidambaram to get a sense of the changed policy regulations relating to foreign direct investment in Indian airline companies.
"We wanted to understand the issues that have impacted Indian civil aviation, and how things will change in the coming years," said Hogan. Hogan also emphasised on the benefits of picking up equity stakes in global airlines like Aer Lingus, Virgin Australia, Air Berlin (Germany) and Air Seychelles. "Equity stakes have enabled us to achieve scale," Hogan said, adding that it gives the airline ability to stretch its network and sell beyond its own network in a digitally connected world.
http://economictimes.indiatimes.com/news/news-by-industry/transportation/airlines-/-aviation/etihad-airways-expects-completion-of-jet-airways-due-diligence-next-week/articleshow/18342591.cms
Addressing the global media through a webcast after posting a 200% jump in its net profit for 2012 to $42 million, James Hogan, president and CEO of the Middle East carrier, said, "We will present the deal to our board and then take a view (on the investment)." He, however, refused to take any more questions on the deal. While there are no specific details on the contours of the deal yet, it is believed that Etihad might pay close to Rs1,800 crore for a 24% stake.
Also, a Jet official has told ET that if all goes well, it might take at least a week or up to 10 days for the deal to be sealed, indicating a possible mid-February announcement.
ET had first reported about a possible deal between Jet and Etihad in September 2012, soon after the sector was thrown open to investment by foreign carriers last year by the civil aviation ministry. And if the Jet-Etihad deal goes through, it will be the first investment by a foreign carrier in an Indian airline. Some top executives of Etihad visited India last week and met civil aviation minister Ajit Singh, commerce minister Anand Sharma and finance minster P Chidambaram to get a sense of the changed policy regulations relating to foreign direct investment in Indian airline companies.
"We wanted to understand the issues that have impacted Indian civil aviation, and how things will change in the coming years," said Hogan. Hogan also emphasised on the benefits of picking up equity stakes in global airlines like Aer Lingus, Virgin Australia, Air Berlin (Germany) and Air Seychelles. "Equity stakes have enabled us to achieve scale," Hogan said, adding that it gives the airline ability to stretch its network and sell beyond its own network in a digitally connected world.
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