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Rediff.com » Business » Jet finally buys Air Sahara for Rs 1,450 crore

Jet finally buys Air Sahara for Rs 1,450 crore

Last updated on: April 12, 2007 15:52 IST

Ending months of acrimony and legal disputes, Jet

Airways on Thursday struck a deal to buy out Air

Sahara for Rs 1,450 crore (Rs 14.50 billion) after

clearance by a three-member arbitration panel.

Jet Airways Chairman Naresh Goyal said this price

represents a 40 per cent discount to the originally

agreed price.

All shares of Air Sahara is to be transferred to Jet on

payment of Rs 1,450 crore inclusive of Rs 500 crore

(Rs 5 billion) already paid by Jet. The remaining

amount is to be paid in instalments, the counsel for

Jet Harish Salve said.

Is Jet-Sahara deal good for you?

Jet informed the Bombay Stock Exchange that it has

agreed to acquire "all shares of Sahara Airlines Ltd for

a lump sum price of Rs 1,450 crore.

"While Rs 500 crore has already been paid, Rs 400 crore is payable immediately no later than

April 20. The balance of Rs 550 crore is payable in four interest free annual equal installments

commencing on or before March 30, 2008."

Soon after the deal was signed, a beaming Naresh Goyal, said: "It is a good deal which is going

to help us. We got a 40 per cent discount to the original price of Rs 2,300 crore (Rs 23 billion).

The deal is commercially viable since we are getting a lot of infrastructure and manpower -

areas where India is facing a lot of pressure now. The airline business has not changed so

dramatically... the deal makes complete economic sense."

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.

The two then submitted a revised and final proposal to the three-member court-monitored

committee, sources close to the development said.

Pallabh Agarwal, executive director, Sahara Pariwar and the group's lawyer Jeffrey Gordon

were present on behalf of Sahara when the deal was signed, while the other side was

represented by senior counsel Harish Salve and Saroj Dutta, besides Jet Chairman Naresh

Goyal.

The development came three days into a week-long, court-monitored arbitration between Jet

and Sahara over the original failed merger in 2006.

Jet Airways is understood to have gone ahead with the deal, as otherwise there was a

possibility of it losing at least Rs 500 crore to Air Sahara.

The deal would give Jet more than 32 per cent share of the domestic aviation market and add

at least 27 aircraft to its 62-aircraft fleet, in addition to prime landing and take-off slots at

major airports such as London Heathrow, New Delhi and Mumbai.

It would become the only privately owned Indian airline with permission to fly overseas.

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Page 1 of 4Jet finally buys Air Sahara for Rs 1,450 crore - Rediff.com Business

22-05-2016http://www.rediff.com/money/2007/apr/12jet1.htm


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Shares of Jet Airways on Thursday recovered after a continuous fall on the BSE to gain over 2

per cent amid the acquisition proceedings for Air Sahara.

The scrip touched an intra-day high of Rs 624.90 and was trading at Rs 616 on the Bombay

Stock Exchange.

Jet-Sahara deal may temper fare war

Jet may buy Air Sahara for Rs 1,800 cr

et Airways founder and chairman Naresh Goyal addresses the media in Mumbai after

clinching a deal to take over Air Sahara.

Photograph: Sajjad Hussain/AFP/Getty Images

dditional Inputs: BS

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Discussion Board

Write a message

Total 89 messages Pages | 1 | 2 | 3 | 4 Older >

Team Sahara hogayi BeSaharaby Karan S (View MyPage) on Apr 13, 2007 01:24 AM

I am a frequent flyer of Jet Airways.Their services are very good.

Slogan now for Indian Team.."Hum hai Team beSahara"

Reply Forward | Report abuse

Dont buy Jet shareby Gautam Sinha (View MyPage) on Apr 12, 2007 06:28 PM | Hide replies

Don't get fooled by the momentary upward movement of Jet's share price. Don't buy it. And I am not CEO butcommon sense says that the near future is not that bright for the company. And historically in long term airlineshares do not return profit. So this is not a good buy for long term either.


RE:Dont buy Jet shareby vikram srivastav (View MyPage) on Apr 13, 2007 09:30 AMDear Mr Sinha,

I have read your comment but I want to say that history never repeat again and again and forexample you can take Air India and Indian merger.

Regards

Vikram


hukum mil gaya hogaby Me Patel (View MyPage) on Apr 12, 2007 06:13 PM | Hide replies

Dawood bhai ne bola hoga Naresh Goyal ko. Cricket Satta nahi chala. Sahara ko lelo. Or phir Indian cricket team kkapde utaro.

Everybody knows, Dawood was having share in Jet Airways


RE:RE:hukum mil gaya hogaby vikram srivastav (View MyPage) on Apr 13, 2007 09:32 AMHi Mr. Patel,

How can you blame any one when the goverment itself given cleanchit to Jet Airways,I m sorry ifI say that you are aslo linked with D group without any proof will you agree about it????

Vikram


RE:hukum mil gaya hogaby Steven (View MyPage) on Apr 12, 2007 08:19 PMmy friend PATEL Dawood has more money in Share market than in airlines....Dawood wud bemore intellent than u to invest in airlines...what say u guju bhai.


RE:RE:hukum mil gaya hogaby hussain naqvi (View MyPage) on Apr 13, 2007 01:26 AM

ab kya likhu neend lagi hai hamare ,kya likhu aap batao , likne ko hai par kya karu neendlagai hai plz sone do


sahara dealby Anusha R (View MyPage) on Apr 12, 2007 06:13 PM | Hide replies

NO - Sahara was not just a deal for Jet - It helped them becoming larger and larger capturing most of the routes ankilling the competition from Sahara - now they will raise the fares of Sahara too, making the passengers no otherchoice, but to fly at the cost decided by Jet.


RE:sahara dealby Shailesh Naik (View MyPage) on Apr 12, 2007 06:36 PMWhy no choice? You can always select other airlines, isn't it?

Reply Forward | Report abuseRE:sahara dealby Anusha R (View MyPage) on Apr 12, 2007 06:50 PMShailesh - there are certain routes Sahara only caters to with low cost..that is what I meant





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