Justifying the coming together of the two airlines, which account for about 60 per cent of the market share, Goyal said that the break-even point for the aviation sector is at 90 per cent capacity utilisation whereas, "We are now operating between 60-70 per cent." Goyal said, "On top of all this, international airlines are dumping capacity in India, lowering their prices knowing we cannot match the competition.... therefore, we have to work together."
Jet Airways Chairman Naresh Goyal said this price represents a 40 per cent discount to the originally agreed price.
Serious Fraud Investigation Office will probe the airline for instances of fund diversions and large-scale irregularities.
The Supreme Court will hear on October 26 a petition alleging that Jet Airways chairman Naresh Goyal has links with the underworld. An appeal filed by M Furquan, a Delhi-based journalist, has alleged that funds for Jet Airways was given by underworld don Dawood Ibrahim. He has also sought a CBI inquiry into the matter.
Contrary to speculation that it was seeking to revise downward the value of Air Sahara, Jet Airways' move to make part payment till the pendency of other issues demonstrated its strong desire to acquire the rival airline.
Air-India (A-I) chairman and managing director Vasudevan Thulasidas and Jet Airways chairman Naresh Goyal have a common agenda: to get their airlines among Asia's top five by 2010 in terms of size and service.
The airline has also finalised its plans to lease out five of its Boeing 777-300 ER aircraft to a Turkish carrier, sources add. The airline has been able to negotiate a premium for the deal in a market where lease premiums have dropped.Domestic carriers are facing turbulent times because of the high crude prices and variable taxation on the air turbine fuel. The problem is now compounded because of a slump in the economy now.
Sebi wanted Jet to convince it that the deal did not amount to joint control alongside promoter Naresh Goyal.
Jet Airways has been looking at various ways to raise funds amid acute liquidity crunch that has forced it to ground aircraft, cancel flights in large numbers, shutdown stations and delay salary payments to its pilots and engineers along with other senior staff.
Besides expanding the equity base of the premier Indian carrier, a major reason for Goyal to dilute part of his shareholding in Jet from 80 per cent has been the FIPB order to bring it down to regulatory levels.
If there was no pressure, then how come the decision to sack staff was reverted within 12 hours, asked Raj.
While Jet founder Naresh Goyal said he was willing to infuse Rs 700 crore and also pledge all his shares in the company provided he can have at least 25 per cent stake, the airline's foreign partner Etihad Airways insists he must not keep more than a 22 per cent stake.
According to media reports, Securities and Exchange Board of India is debating whether to reopen the issue of an open offer for shareholders of Jet Airways after another regulator said that Etihad enjoys joint control over the Indian airline.
"The markets do not remain the same forever but still, anything that makes sense to Jet Airways' shareholders will make sense for the promoters as well," Goyal said. Together with JetLite, formerly Air Sahara, which Jet bought last year, the airline controls over 29 per cent of the Indian domestic market.
The Jet Airways of old is no more and the industry mourns its demise. Anjuli Bhargava reports.
Sources close to the deal say, besides a higher stake (earlier, the negotiations were on for sale of up to 24 per cent), Etihad has asked for its representation on the board of the Indian airline, in sync with its shareholding.
The top executives who have put in their papers with immediate effect include Jet's chief executive officer (CEO) Vinay Dube, chief finance officer (CFO) and deputy CEO Amit Agarwal and company secretary Kuldeep Sharma.
Shares of Jet Airways surged 16 per cent to close at Rs 505.7 on Friday on speculation that Etihad Airways might buy 24 per cent in the company.
Jet Airways Chairman Naresh Goyal on Wednesday said that he would have no option but to follow 'the law of the land' if an action had to be taken against the agitating pilots, while appealing to them to resolve the matter amicably and return to work. Meanwhile, Goyal met Civil Aviation Minister Praful Patel in the wake of the agitation by the airline pilots.
Air fares in India were about 300 per cent higher than those in China and some other countries because of high tax rates, Jet Airways chief Naresh Goyal said on Monday, asserting that the aviation industry could not grow with such taxation.
Jet's flights to Abu Dhabi could be used to carry passengers from India headed for the US and Europe.
A mix of financial and strategic mistakes combined with poor expectations of the management are the reasons for the downfall of Indian airlines. For Jet, the deathly potion was even more toxic on account of the bitter squabbles between promoter Naresh Goyal and strategic partner Etihad Airways.
Speaking at the 2013 CAPA Australia Pacific Aviation Summit held in Sydney, Abu Dhabi-based Etihad Airline's President and CEO James Hogan said, "We are delighted to welcome Air Serbia to our equity alliance, and look forward to receiving final approvals from regulators in India of our investment in Jet Airways," he added.
Jet Airways is planning to launch flights to Shanghai, San Francisco and Washington from New Delhi and Mumbai by February. The company also intends to raise Rs 500 crore (Rs 5 billion) via equity dilution.
Fresh troubles are brewing for Jet-Etihad deal.
Jet Airways chairman Naresh Goyal on Thursday vehemently denied any link with the underworld saying all agencies have cleared his airline in this connection and that is why the carrier has been allowed to fly to the US.
On the high costs facing the Indian airline industry, Goyal said the factors included a depreciating rupee against the dollar, escalating jet fuel prices, high taxes and rising infrastructure costs.
Jet is believed to be in talks with leading private equity players.
The Bombay high court has asked Mumbai Police Commissioner to file a report on the alleged underworld links of Jet Airways chairman Naresh Goyal.
The process of getting a new promoter on board is likely to take another two to three months and once that happens, the banks would offload their stakes.
The Securities and Exchange Board of India has cleared the initial public offer of Jet Airways.
India's largest private carrier Jet Airways said on Tuesday it expects to more than double its revenues to $3 billion in the next three years. The company on Monday announced its total income rose over 26 per cent to Rs 2,254.17 crore (Rs 22.54 billion) in the second quarter this fiscal from Rs 1,787.33 crore (Rs 17.87 billion) during the same period last fiscal.
Subsequent to a failed acquisition deal, Air Sahara, on Friday, filed a Rs 3,020 crore (Rs 30.2 billion) claim against Jet Airways for non-completion of the agreement.
Jet also recently announced plans to launch direct flights to Brussels this summer, launching itself as a direct rival to Air India on flights between India and Europe.
Jet Airways, which inducted the 42nd aircraft in its fleet, has urged the government to allow domestic private carriers to fly abroad and also carry out their own ground handling.
India's largest private sector airline Jet Airways has postponed its $400 million (Rs 1600 crore) rights issue slated for March this year by three or four months, the third postponement since the board approved it in June, owing to poor market sentiment.
According to the revised plan, promoter Naresh Goyal, his wife Anita Goyal and the directors nominated by the promoter would be asked to step down from the board, and the lenders, as part of the resolution process, will infuse around Rs 1,200 crore into the airline as emergency funding.
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