Jet-Sahara merger: Patel promises smooth sailing

Civil Aviation Minister Praful Patel today said the government would not come in the way of Jet Airways' bid to acquire Air Sahara for Rs 2,300 crore.

"We are not against the merger," Patel said today on the sidelines of the programme to sign agreements with consortia led by GMR Group and GVK Group for modernisation of Delhi and Mumbai airports.

"We want the sector to grow. The government should not do anything to stop the sector from growing. We are here to facilitate the growth," he said.

Patel's statement comes close on the heels of the government clearing regulatory hurdles in the way of the two carriers' merger. It recently effected a policy move that will enable an airline to take over the entire assets of the carrier it acquires. Jet's bid to acquire Air Sahara was stuck on the government's earlier insistence that Jet was not entitled to get Air Sahara's entire airport infrastructure and flight rights.

Patel said the proposed mergers and acquisition (M&A) policy regarding the domestic aviation sector would be aimed at facilitating consolidation.

The proposed policy will lay down guidelines regarding the transfer of traffic rights and airport infrastructure of an airline after its acquisition. Besides, there will be conditions regarding transfer of air traffic rights. The transfer of flying rights will depend on the number of miles the airline flies on smaller routes.

Patel said the proposed merger of the state-run Air India and Indian would be completed in 2006.