India’s Foreign Investment Promotion Board (FIPB) reportedly intends to make a decision on the acquisition of 24% in Jet Airways by Etihad Airways this week (Economic Times, 13-Jun-2013). If the FIPB passes the acquisition, it will then go to the Cabinet Committee on Economic Affairs (CCEA) for final clearance, due to the fact that the value of the deal is greater than INR12 billion (USD207 million). On 24-May-2013, Jet Airways shareholders approved a preferential allotment of 27.3 million shares in the airline to Etihad Airways for INR754.74 per share, totalling INR20.6 billion (USD379 million). A USD150 million equity investment will also be made in Jet Privilege - Jet Airways' global frequent flyer programme - for a stake of 50.1%. Jet Airways expects the carrier’s deal with Eithad Airways will allow it to reduce its debt from USD2.1 billion to USD1.5 billion.
14-Jun-2013 11:57 AM