How much exactly did Jet Airways pay for Air Sahara?

New Delhi: Six months after Jet Airways agreed to purchase Air Sahara, it is still not clear exactly how much money changed hands.
On 10 April, when Jet Airways revived the deal to buy out Air Sahara, newspapers widely reported that deal would cost about Rs2,000 crore and would include Rs450 crore of Sahara’s accumulated debt.
Two days later, when the deal was announced, Naresh Goyal said the deal cost Rs1,450 crore.
“It is a good deal which will help us,” he said. Then, referring to a price that the two airlines had previously agreed upon in early 2006, he said “the deal is 40% cheaper than the the one signed last year.”
But hours later, at Air Sahara’s offices at Gopaldas Bhavan, Alok Sharma, the president of the airline, told reporters that Jet had actually paid Rs1,950 crore.
In an interview on 20 August, Sharma repeated his assertion of April: over and above the cash payments, Jet has absorbed Rs450 crore liabilities from Sahara, including Rs300 crore in outstanding debts.
Saroj Datta, the executive director of Jet Airways, who was closely involved in the negotiations that resulted in the sale, on Tuesday, called Sharma’s claims “a false and untrue statement”.
So how much exactly did Jet Airways pay? Rs1,450 crore (which was described on Jet’s balance sheets for the quarter ended 30 June, 2007, as Rs1,460 crore)? Or, Rs1,950 crore?
Three analysts in India, who declined to be named for this story, said that they had repeatedly pushed for clarification on this issue with the airline and had not received satisfactory answers.
And Damien Horth, a Singapore-based analyst for UBS Ltd, said he was taking Jet’s assertions at face value. “What Jet has said to me is that they have taken on a clean balance sheet, with the caveat that they have taken on the operational leases for the aircraft,” he said.
Either way, Horth felt that Jet Airways had overpaid for Air Sahara.
22/08/07 Mehul Srivastava/Livemint

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Categories: Jet Airways Aug 2007, Jet Lite Aug 2007