Jet seeks FIPB nod for selling stake to Etihad

Private carrier Jet Airways has sought approval of the Foreign Investment Promotion Board (FIPB) to sell 24 per cent stake in the company to Gulf carrier Etihad Airways, sources said today.

"Jet has filed its application to the FIPB late last week. The issue is expected to come up for discussion on May 10 to decide on further action," the sources said.

After months of deliberations, Jet Airways and Etihad last month signed a deal under which the premier Indian carrier agreed to sell 27.26 million shares in a preferential offer to the latter at Rs 754.74 a piece.

"The value of this equity investment is USD 379 million (about Rs 2,058 crore) and will result in Etihad Airways holding 24 per cent of the enlarged share capital of Jet Airways," a joint statement by the two airlines had said while announcing the deal.

"This strategic investment with a USD 600 million commitment from Etihad Airways will help further strengthening of Jet Airways' financial position," it had said.

Besides, Etihad would also invest USD 150 million "by way of a majority equity investment in Jet Airways' frequent flyer programme 'Jet Privilege', subject to regulatory and corporate approvals and final commercial agreements, the airline said.

Once the transaction is completed, this will be first deal since the government in September last year allowed foreign carriers to buy up to 49 per cent stake in local airlines.