Jet board meets to raise funds

January 14, 2006 13:54 IST

Amid reports of a strategic tie-up with Air Sahara, Jet Airways has called a meeting of its board of directors on January 21 to consider raising funds through an equity or debt instrument, besides taking up its third quarter results for consideration.

Just a year after the company's Rs 1,899 crore (Rs 18.99 billion) IPO in February 2005, its communiqué to the stock exchange on the board meeting fuelled fresh speculation that the Naresh Goyal-promoted company would use the money to pick up an equity stake in Air Sahara.

It is obvious that the funds are not required for fleet expansion as Jet Airways has already tied up with international lending agencies for this purpose.

Earlier, the company had planned to hold its board meeting on January 30 to consider its Q3 results, though no official intimation was sent to the stock exchange.

The advancement of the date is as an indication that an announcement of the deal with Air Sahara may soon be announced.

"The alliance might also require shareholders' permission. Therefore, it would be convenient for Jet Airways

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Jet Airways was not forthcoming either on the purpose of raising funds or on the possibility of discussing the strategic alliance. A senior company executive declined to comment on these issues.

But the sources said Jet Airways had constituted separate committees to examine various areas such as marketing, administration and operations just in case the proposed strategic alliance sees the light of the day. Director General of Civil Aviation office said that there was no official communication on the "take-over".

In the air

Raising funds through equity or debt instruments

Taking stock of the company's third-quarter results

Possible alliance with Air Sahara