Mumbai: When Etihad Airways first bailed out India's Jet Airways in 2013, the terms were less than ideal: a minority 24% stake, bought at a premium, and with management remaining firmly in the hands of founder and Chairman Naresh Goyal.
It was, according to analysts, a long-term bet on the fast-growing but fiercely competitive Indian market. Five years later, that bet may be closer to paying off as Etihad offers to bail out Jet Airways once again, this time on terms closer to its own choosing.
The Indian carrier is on even weaker footing than it was back then. It faces a mountain of debt coming due soon, and fierce competition from budget carriers has eroded its once-dominant share of the $16 billion domestic market to less than 14%.
Jet Airways' board will meet soon to discuss its options, according to sources. On the table is Etihad's proposal to buy a 45% stake at a roughly 50% discount and on condition that Goyal step down as chairman. There are also rumors that State Bank of India, Jet Airway's biggest lender, could take a 15% stake in the airline in a debt for equity swap.
31/01/19 Rosemary Marandi/Nikkei Asian Review
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It was, according to analysts, a long-term bet on the fast-growing but fiercely competitive Indian market. Five years later, that bet may be closer to paying off as Etihad offers to bail out Jet Airways once again, this time on terms closer to its own choosing.
The Indian carrier is on even weaker footing than it was back then. It faces a mountain of debt coming due soon, and fierce competition from budget carriers has eroded its once-dominant share of the $16 billion domestic market to less than 14%.
Jet Airways' board will meet soon to discuss its options, according to sources. On the table is Etihad's proposal to buy a 45% stake at a roughly 50% discount and on condition that Goyal step down as chairman. There are also rumors that State Bank of India, Jet Airway's biggest lender, could take a 15% stake in the airline in a debt for equity swap.
31/01/19 Rosemary Marandi/Nikkei Asian Review
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