MUMBAI (Reuters) - Shares in Jet Airways surged as much as nearly 20 percent after Gulf carrier Etihad Airways said it is taking almost a quarter stake in Jet Airways at 754.74 rupees per share, a 31.7 percent premium to Jet's closing share price on Tuesday.
Etihad will also invest an additional $150 million in Jet's frequent flyer programme and spend $70 million to buy Jet's three pairs of Heathrow slots through the sale and leaseback agreement announced in February.
The deal sets a valuation benchmark for further investment in Indian airlines, with budget carrier SpiceJet Ltd frequently the subject of stake sale reports.
As of 9:25 a.m., Jet shares were up 14.3 percent. Spicejet gained 10.5 percent, while Kingfisher Airlines Ltd gained 2.2 percent.
(Reporting by Abhishek Vishnoi; Editing by Anupama Dwivedi)