Wednesday, September 23, 2015

Etihad Airways to buy bonds to help Jet Airways recast debt

A special purpose vehicle (SPV) floated by Abu Dhabi’s Etihad Airways PJSC will buy bonds worth Rs.738 crore out of a non-convertible debenture (NCD) sale of around Rs.1,000 crore planned by Jet Airways (India) Ltd, two people close to the development said.

The move will help India’s second largest airline by passengers carried, in which Etihad holds a 24% stake, refinance costlier debt.

As on 31 March, the Naresh Goyal-controlled Jet Airways had a consolidated debt of Rs.11,902.67 crore. Jet Airways has already secured approvals from shareholders to raise $400 million via NCDs.

The first person cited above said raising cheaper debt from EA Partners IBV is critical for Jet Airways at this time. EA Partners is an SPV created by Eithad Airways along with its own airport services unit and five airlines in which it holds equity stakes. Last week, the SPV raised $700 million through an innovative new platform of financing transaction on the international markets.
23/09/15  P.R. Sanjai/Dalal Street Asia
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