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Jet Airways, Air Sahara merger clears key hurdle - reports

BOMBAY (XFNews) - Indian officials have cleared a key obstacle to the country's largest aviation merger between Jet Airways and Sahara Airlines following a dispute over landing rights, the Press Trust of India (PTI) reported citing sources. 


An aviation committee has recommended the full transfer of Sahara Airlines' assets to domestic carrier Jet Airways including parking bays and landing slots, PTI said.

The deal was struck in January, but talks have reportedly been stuck over whether the government would approve the transfer.

Saroj Datta, executive director of Jet Airways, declined to comment on the reports. "We have received no official communication," he said.

The decision still needs to be approved by the government, along with new guidelines on mergers between airlines, according to PTI. They are expected next week.

Merger talks between executives of the two airlines, to create a company with almost half the domestic market, were extended for another three months earlier this week.

Consolidation is expected in the booming Indian airline industry with domestic passengers, forecast to increase to about 50-60 mln a year by 2010 from some 25 mln.

A merged entity will increase the competition for carriers like state-run Indian and private-sector Kingfisher Airlines, as well as budget carriers like SpiceJet, Air Deccan and GoAir.