 "Jet & Etihad may miss deal deadline yet again")
The Rs 2,058-crore Jet-Etihad deal may miss the transaction closure deadline for a second time as the two sides await clearance from the Cabinet Committee on Economic Affairs.
The agreement between the two has a long stop date clause, stipulating that all approvals be secured by then. Originally fixed as July 31, the date was later revised to September 30. The agreement allows both parties to extend the date; it is likely to be revised again.
An email query to Etihad on Sunday went answered. The Gulf airline had last month said it was agreeable to extending the long stop date till September-end as both sides worked to complete the regulatory process. The deal was signed on April 24 and was expected to secure approvals by July-end. But that deadline was missed as the Securities and Exchange Board of India and Foreign Investment Promotion Board raised concern over the shift of management control to Etihad. Additionally there was controversy over BJP leader Subramanian Swamy allegations that the government sweetened the deal by enhancing traffic rights to Abu Dhabi. Swamy has filed a petition against the deal in the Supreme Court.
The agreement between the two has a long stop date clause, stipulating that all approvals be secured by then. Originally fixed as July 31, the date was later revised to September 30. The agreement allows both parties to extend the date; it is likely to be revised again.
An email query to Etihad on Sunday went answered. The Gulf airline had last month said it was agreeable to extending the long stop date till September-end as both sides worked to complete the regulatory process. The deal was signed on April 24 and was expected to secure approvals by July-end. But that deadline was missed as the Securities and Exchange Board of India and Foreign Investment Promotion Board raised concern over the shift of management control to Etihad. Additionally there was controversy over BJP leader Subramanian Swamy allegations that the government sweetened the deal by enhancing traffic rights to Abu Dhabi. Swamy has filed a petition against the deal in the Supreme Court.
On July 29 the FIPB cleared the Jet-Etihad deal with certain riders forcing the airlines to make another set of changes to the agreements. The two sides are also to secure a clearance from the Competition Commission of India.