Jet takes over Sahara for Rs 1450 cr

Ending months of acrimony and legal disputes, Jet Airways today struck a deal to buy out Air Sahara for Rs 1,450 crore after clearance by a three-member arbitration panel.

"They (Jet and Sahara) have signed an agreement by which Jet takes over all the shares of Sahara for a price of Rs 1450 crores. Rs 500 crore was already paid, Rs 400 crore on or before April 20; the balance in equal annual instalments, payable from March 31, 2008, 2009, 2010, 2011, which will be interest-free. These are the important parts of the transaction, and we have informed the stock exchange," Jet's counsel, Harish Salve announced before the eager media today.

When probed for more, he declared, "The big news is that the two airliners have ended their dispute amicably and it's back in the skies again, as far as Jet is concerned."

On its part, Air Sahara seems to be content too. Air Sahara President, Alok Sharma  told  today that both the parties were happy with the deal and that the adjustments on assets will go back to the promoters.

Jet Airways Chairman Naresh Goyal said this price represents a 40% discount to the originally agreed price. He expressed his conviction in the deal saying, "There is no change in what was said in January, again in March; and I still say that there is no change in the thinking in the commercial sense. Commercially, it was good for the shareholders at that time. Keeping in mind the present condition aviation, it is again going to be very good, as far as the deal is concerned.  What we are doing is going to help the shareholders," he said.

Both, Salve and Goyal refused to divulge anything more, but promised to be more elaborate on the 16th of this month.

The deal was signed after the panel comprising British judge Lord Stein and Supreme Court Justices S P Bharucha and Jeevan Reddy, vetted the draft proposal prepared by Jet and Sahara.

This is the second merger in the country's aviation industry after the two state-owned air-carriers, Air India and Indian Airlines announced their merger last month.