Ten months after he tried to back out of his offer to buy Air Sahara for $500 million (Rs 2,200 crore), Jet Airways chief Naresh Goyal is set to buy the airline at a lower price. However, Sahara will get to keep the interest on the Rs 500 crore down payment Goyal had paid.
On Wednesday, the airlines could announce an out-of-court settlement after getting it cleared from the arbitration tribunal, which is hearing the case, sources close to the development said. Lawyers of the two airlines, while appearing for a regular hearing of the case in the Bombay High Court, said they had “agreed on commercial terms to resolve their dispute and would present the details after getting a decision from the tribunal, expected at 5.30 pm on Wednesday.’’
Jet may agree to buy Air Sahara for close to Rs 2,000 crore, minus the Rs 275 crore Air Sahara owes its creditors, Sahara’s helicopter assets and immoveable assets, according to sources close to the deal. The price also includes the Rs 180 crore it spent in running Air Sahara for a few months. Neither airline offered official comment.
But the final bill might be higher. Experts say Jet would need to pump in Rs 1,000 crore to strengthen and integrate Sahara. “The move defies logic. It might be a legal necessity,” said Kapil Kaul of the Centre for Asia-Pacific Consultancy, an airline consultancy.
Experts feel Jet may have found itself in Catch-22 situation. “Jet is trying to raise $400 million (Rs 1,700 crore) to fund its expansion. But the money comes with riders, and one of them could be to settle this case as soon as possible,” said an airline industry analyst.