New Delhi: Jet Airway's ambitious plan to fly from 23 Indian cities to Abu Dhabi after the deal with Etihad clears Foreign Investment Promotion Board (FIPB) hurdle may prove to be the next stumbling block after the "effective control" issue.
The Competition Commission of India has sought detailed response from Jet and Etihad on the combined market share the two airlines expect to have on the India-Abu Dhabi and beyond routes to places like North America and Europe where other Indian carriers also fly.
Jet has sought time till August 5 to reply to CCI queries. It wants to get FIPB nod when the board meets on Monday. Since FIPB and market regulator SEBI had raised concerns about "effective control and ownership", some changes are learnt to have been made in the structure of the deal. "Etihad will now have two directors on the 10-member board, instead of four proposed earlier. This will limit their say in the airline post deal. Big ticket appointments will be made by majority of votes and that should give Etihad say in the airline commensurate to its 24% stake in Jet," said sources.
27/07/13 Saurabh Sinha/Times of India
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The Competition Commission of India has sought detailed response from Jet and Etihad on the combined market share the two airlines expect to have on the India-Abu Dhabi and beyond routes to places like North America and Europe where other Indian carriers also fly.
Jet has sought time till August 5 to reply to CCI queries. It wants to get FIPB nod when the board meets on Monday. Since FIPB and market regulator SEBI had raised concerns about "effective control and ownership", some changes are learnt to have been made in the structure of the deal. "Etihad will now have two directors on the 10-member board, instead of four proposed earlier. This will limit their say in the airline post deal. Big ticket appointments will be made by majority of votes and that should give Etihad say in the airline commensurate to its 24% stake in Jet," said sources.
27/07/13 Saurabh Sinha/Times of India
