Some senior executives who had joined Jet AirwaysNSE 1.24 % from Etihad Airways after the latter picked up a significant stake in the Indian carrier in 2012 are playing a key role in the fresh negotiations between the two for additional equity and loans.
Meanwhile, RBSA Advisors, an active valuation consultant that had advised the government on Air India’s planned divestment, has been roped in to estimate a valuation for Jet Airways as the proposed deal inches forward, said two people in the know.
Jet is wooing its Abu Dhabi-based partner, which owns 24% stake in it, to buy more stake and give it soft loans, people familiar with the development told ET.
Among key names in the negotiations are Renyl Rauf, former head of finance at Etihad who joined Jet earlier this year as senior vice president, and Cramer Ball, an Etihad veteran who was Jet’s CEO from May 2014 to March 2016.
Rauf, who joined Jet in August before negotiations started anew, is said to be closely aiding chairman Naresh Goyal in the talks, while Ball is playing an active role from Etihad’s side as senior advisor in Etihad Aviation Group, people close to the matter said.
They said that in a sort of deja vu from 2012 and symbolic of Etihad’s signature working style, more executives from the Gulf airline may join Jet in various roles as and when the deal nears fruition.
An email sent to Etihad remained unanswered as of press time Monday. A Jet spokesman said, “In line with its policy Jet Airways does not comment on speculation.”
About 15 people from Etihad had joined Jet in various roles after the first stake sale deal completed in 2013. They included successive CEOs Gary Toomey and Ball, Rauf as vice president, finance, Rajeev Nambiar as vice president sales, Manish Raniga as vice president commercial strategy after an advisory role, and Martin Drew as vice president cargo. Others included Roy Kinnear, Rangesh Embar and Felipe Zambrano in advisory roles, and Emma Penn and Rob Putter in project management, IT and technology management.
Rauf left Etihad in July this year and was slated to join Kuwait’s Jazeera Airways as CEO, but got roped in by Jet instead, said a person cited above.
Ball, who had donned various hats at Etihad, was, as Jet’s CEO, responsible for a build-up of key synergies between the two partners. He later joined Alitalia, another of Etihad’s strategic partners as CEO before returning to his old employer as an advisor.
Known as Etihad’s “fix-it man” Ball also played a key role in Jet’s efforts to sell a stake in its loyalty programme Jet Privilege. That deal is also yet to fructify. Potential buyers have said they will go ahead only once Jet gets cash.
Alternately, Etihad, which owns 50.1% of Jet Privilege, may invest too, said sources cited earlier.
Robin Kamark, CEO at Etihad Airline Equity Partners, had last month replaced Harsh Mohan as Etihad’s nominee on Jet’s board.
Goyal has been wooing Etihad to make a fund infusion in the airline by offering up to 49% stake in a bid to save his financially struggling carrier, and he may part with his controlling stake, the sources said.
The proposed deal entails transfer of management control and people close to the development have said Etihad is now looking for a local partner for the stake buy as a foreign airline cannot have management control in an Indian carrier.
Jet, bereft of cash and burdened under massive debt and losses, has delayed paying salaries and is pruning operations and staff in trying to stay afloat.
Apart from Air India, RBSA has in the past acted as a valuation & financial advisor to Essar Steel’s lenders under the Insolvency & Bankruptcy Process. It also advised British oil and gas company BP for valuation of Reliance Industries’ reserves in the KGD6 block.
It has also been appointed by the government for valuation of Hindustan Zinc, various coal blocks and on State Bank of India’s merger with associate banks.
Source: Economic Times