NEW DELHI (TIP): Concluding the first instance of FDI by a foreign carrier into an Indian airline, Jet Airways on Wednesday announced that it has given equity shares worth Rs 2,060 crore to Abu Dhabi’s Etihad-representing a 24% stake in Naresh Goyal’s airline. Also, Etihad president James Hogan and CFO James Rigney have been named as additional directors on board of Jet, giving the Gulf carrier a firm say in how Jet will be steered now.
With this announcement, the $900-million deal was finally concluded seven months after it was announced. The final approval had come with the last week giving it the nod. Jet chairman Naresh Goyal said: “I am confident that this investment will greatly benefit all our stakeholders while significantly benefitting our customers, who will now have access to a more expanded global network” apart from expanding network. Etihad president James Hogan said: “India is one of the largest and fastest-growing markets in the world and a key part of the Etihad growth strategy.
Through this association, Etihad and Jet will both be strengthened, as will the economies of India and the UAE. By linking our two networks and adding new flights, new routes and more code-share options, travel to, from and within India will become much easier.” The two airline chiefs said their collaboration will begin immediately. In fact, Etihad been enforcing changes at Jet much earlier. This saw Jet CEO Nikos Kardasis, investor relation chief K G Vishwanath and longstanding director Victoriano P Dungca resigning. This change came as Jet saw its finances crumble: combined loss of over Rs 2,000 crore since 2006; long term debt of Rs 9,134 crore on September 30 and most recent record loss of Rs 998.5 crore for the group this Q2.