New Delhi: Jet Airways (India) Ltd is close to selling a 24% stake to Eithad Airways in a potential $400 million deal, a website said in a report late on Friday.
“Etihad Airways of the UAE is close to acquiring 24% stake in India’s second largest carrier Jet Airways in a deal expected to be worth Rs.2,200 crore. The deal would give Jet Airways a post money valuation of around $1.7 billion, more than twice its current market cap,” investment website VCCircle.com said in a report on its website.
Jet Airways, together with its subsidiary JetLite, is the country’s second largest airline by domestic passengers market share.
“We do not have adequate information at this stage to comment on this issue,” a Jet Airways spokeswoman told Mint late on Friday night.
Eithad India country manager Neerja Bhatia could not be reached for comment on mobile.
Jet Airways touched a 52-week high on the bourses on Friday on the stake sale speculation. The stock gained about 16% to close at Rs.505.75 on the BSE.
Jet is 80% controlled by Naresh Goyal through Tailwinds Ltd, which is registered in the Isle of Man. It was not immediately clear how Jet, which already has 80% foreign holding, would sell a 24% stake to a foreign airline under the current rules.
In September, an Eithad Airways spokesperson had said the airline welcomed the Indian government’s allowing foreign airlines to pick up a stake of up to 49% in Indian carriers.
“Etihad Airways has identified equity investments in other airlines as an important evolution of our successful partnership strategy,” Eithad spokesperson had said adding, “Equity investment strengthens our relationships and allows us to work together with partners to identify revenue generation and cost management opportunities.”
“It is our policy not to comment on such speculation. If or when we do make further investments of this sort, we will announce them in line with regulatory and commercial requirements,” the spokesperson said.