Competition Commission looking into Jet-Etihad deal
Fair trade regulator Competition Commission is examining the over Rs 2,000-crore deal between leading carrier Jet Airways and Abu Dhabi-based Etihad Airways.
The Competition Commission of India (CCI) has received an application seeking approval for the proposed Jet-Etihad transaction. "We are looking into the deal," a senior CCI official said
However, the Jet-Etihad deal is unlikely to get a go-ahead from the competition watchdog before the end of June. The CCI is likely to seek further clarifications from the two companies.
While the CCI is unlikely to seek clarifications on domestic operations, it would seek clarity on the impact of the deal on international operations specially related to routing arrangements through gulf countries. CCI is also likely to seek more information to ascertain impact on number of airport slots held by various operators.
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Forging a strategic alliance, Jet Airways has decided to sell 24 per cent stake to Etihad Airways for about Rs 2,058 crore. The deal would mark the first investment by a foreign carrier in an Indian airline since the change in FDI policy.
Most of the merger and acquisition deals require approval from the Commission, which keeps a tab on anti-competitive practices in the market place.
Under the proposed deal, Jet Airways would offload sell 27.26 million shares in a preferential offer to Etihad at Rs 754.74 a piece.
"The value of this equity investment is USD 379 million (about Rs 2,058 crore) and will result in Etihad Airways holding 24 per cent of the enlarged share capital of Jet Airways," the two airlines had said in April.
The alliance is also expected to bring additional traffic, frequencies and revenues to metro airports, as well as several non-metro airports of the Airports Authority of India.