July 29--NEW DELHI -- The $900 million Jet Airways (India) Ltd and Etihad Airways PJSC deal has been conditionally approved by the Foreign Investment Promotion Board (FIPB).
The transaction will see Jet selling a 24 percent stake to the Abu Dhabi-based airline. The approval was granted by FIPB on Monday with conditions attached, Arvind Mayaram, secretary, department of economic affairs, said without elaborating further.
The conditions include Jet seeking prior government of India approval for any changes in the shareholders' agreement with Etihad and any arbitration would have to be under Indian law and not English law as was proposed in the revised shareholders' agreement submitted by Jet-Etihad to FIPB, PTI reported.
A civil aviation ministry official who is aware of the developments said there was "good news" for Jet Airways.
FIPB had last month deferred a decision on Jet Airways' plan to sell shares to Etihad, as authorities sought more details about the control and ownership of the Indian company after the stake sale.
The deal will now need clearance from the cabinet. If the deal is approved, it will become the first investment by a foreign airline in an Indian airline after the government eased aviation rules in September.
The deal has been opposed by many parliamentarians and Janata Party president Subramanian Swamy, who has said he will approach the courts if FIPB clears the Jet-Etihad transaction.
Mint reported on Sunday that the two airlines had sought a conditional approval from FIPB ahead of the deadline for the closure of the transaction.
Shares of Jet Airways rose 4.22% to Rs.412.20 on Monday on BSE, while the exchange's benchmark Sensex shed 0.28%.
Copyright 2013 - Mint, New Delhi
