Jet Air to pay Rs 500 crore to Sahara

TIMES NEWS NETWORK

New Delhi: Even as the hard bargain over acquiring Air Sahara continued, Jet Airways has committed to pay its smaller rival Rs 500 crore towards meeting operational expenses.
The amount – which is being paid against the pledge of 100% shares of Air Sahara – will be reimbursed in case the deal falls through, Jet Airways said.
However, Jet will stand to lose the Rs 120 crore it had paid to Sahara after inking the deal in January in case the agreement is terminated now, sources said.
The two airlines had on Thursday night agreed to extend the term of their share purchase agreement and the escrow account created for the transaction by 90 days to seek more clarity over the transfer of Sahara’s parking and flight rights.
The additional Rs 500 crore would be paid through the escrow account as advance payment. Though officials of both the airlines were tightlipped on the issue renegotiating the value of the deal, sources pointed out that talks are underway in view of the fact that sovereign parking and flight rights controlled by Air Sahara may not be automatically transferred to Jet, post-acquisition.
The decision to pay Rs 500 crore against the final payment was taken at a high-level meeting between Goyal and Sahara India Pariwar chief S u b r at a Roy late on Thursday night.






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