Mumbai: Naresh Goyal, who is the promoter and chairman of India’s largest airline group Jet Airways, will sell at least 5% of the stake he owns to private equity houses by March 2008 in line with a market regulator fiat on public shareholding of listed companies in India.

Jet Airways chairman and promoter Naresh Goyal

Confirming the development, Goyal said he would act upon the guidelines of the market regulator.

“I will certainly fall in line with the regulator’s guidelines. I will do whatever is good for my company and its balance sheet," he said on the sidelines of the company’s annual general meeting on Thursday.

Last Jet Airways sold shares was when Goyal offloaded 20% of the airline firm’s equity capital in an initial public offering in February 2005 at Rs1,100 a share. Since then, the share price has plummeted to as low as Rs475 last July, before recovering to the current levels. The firm’s shares fell 4.95% on the Bombay Stock Exchange to Rs907.35 on Friday.

Jet Airways also plans to raise $400 million through a rights issue sometime in December or January to fund its aircraft acquisition programme, chairman Naresh Goyal says

Jet Airways is also planning to raise $400 million (Rs1,592 crore) through a rights issue to fund its aircraft acquisition programme.

“We have selected the bankers to the (rights) issue and their lawyers are in the process of preparing the relevant documentation. We expect to launch the rights issue sometime in December 2007 or January 2008," Goyal said. SSKI Corporate Finance Pvt. Ltd and HSBC Securities Services & Capital Markets India Pvt. Ltd are managing the issue.

A Mumbai-based industry analyst said that the stabilization of air fares following the consolidation in the industry augured well for Goyal. “But a preference issue would have been best option for (him) to bring down his shareholding to 75% rather than going for a rights issue of $400 million," the analyst said.