Shares in Jet Airways was greeted with a rise of over 7 percent of its shares on reports that the carrier might sell a stake to Etihad Airways.
MUMBAI- The Business Standard newspaper reported, citing a government official, that Jet Airways might raise 16 billion rupees from the sale of a 24 percent stake of its capital to Abu Dhabi’s based carrier Etihad Airways. Etihad’s chief executive officer said on Tuesday the Abu Dhabi-based airline was in talks with Indian airlines. The move was favored by new rules set up by the Indian Government last September which now allows foreign carriers to buy stakes of up to 49 percent in local airlines. Foreign cash would help to make Vientam’s domestic carriers more competitive to local competition.
Jet and Etihad already have a code-sharing agreement and a deal could help them win market share from state-owned Air India, as well as from Dubai-based Emirates Airline, which dominates routes between India and the Middle East.
Etihad is interested to access to Jet’s low-fare domestic network under JetKonnect, an industry source said in Dubai. “We’re involved in negotiations in India,” James Hogan said in an interview broadcast on Bloomberg-UTV news channel.
Jet Airways has risen 65.3 percent since the start of November, as of Monday’s close, on speculation that promoter shareholder is looking to sell a stake. Shares in other carriers such as SpiceJet rose 4 percent, while Kingfisher Airlines gained 3 percent.
Luc Citrinot a French national is a freelance journalist and consultant in tourism and air transport with over 20 years experience. Based in Paris and Bangkok, he works for various travel and air transport trade publications in Europe and Asia.
