Etihad Airways, the Abu-Dhabi based carrier purchasing a 24 percent stake in Jet Airways (India) Ltd., said it expects the $600 million investment to be approved by Indian authorities “imminently.”
The deadline for the regulatory approval of the deal was extended to the end of September from Aug. 31, an Etihad spokesperson said by telephone yesterday.
Shares of Jet Airways climbed in Mumbai as a transaction would mark the first stake sale by an Indian carrier to a foreign airline after the nation eased ownership rules last year. Etihad and Jet won conditional permission for their deal from India’s Foreign Investment Promotion Board in July, pending further approvals from the country’s finance minister and Cabinet Committee on Economic Affairs.
“The revised agreements are expected to be endorsed by the Competition Commission of India and the Indian Government imminently,” Etihad said in an e-mailed statement yesterday. This is the second deadline extension for the deal approval.
Jet rose 5.5 percent, the most since Aug. 23, to 308.25 rupees at the close in Mumbai. The stock has declined 45 percent this year, compared with a 2.8 percent drop for the S&P BSE Sensex.
“We are working very closely with the Indian Government and regulatory authorities to ensure we meet all the requirements of the new foreign direct investment legislation,” Etihad Chief Executive James Hogan said in the statement.
Hogan and Jet Airways Chairman Naresh Goyal met in Mumbai this past weekend to “review progress on the finalization” of the deal, according to the statement.
Ragini Chopra, a spokeswoman at Jet Airways, didn’t immediately respond to two calls and a text message to her mobile phone.
Etihad will purchase 27.26 million Jet shares at a cost of 20.6 billion rupees ($311 million). In April, Etihad said the deal lifts its commitment to Jet to $600 million, including the purchase of three pairs of slots at London Heathrow airport for $70 million in February and a $150 million investment in a majority stake in the Jet Privilege frequent-flier program.