Jet Airways India Ltd, the carrier part-owned by Etihad Airways PJSC, is seeking to raise about $300 million to fund expansion on international routes, people with knowledge of the matter said.
Jet Airways, India’s second-largest airline by passengers, has started talks on a potential equity fundraising from investors other than Etihad, the people said, asking not to be identified because the information is private. The company, which has a market value of Rs4,190 crore ($617 million), aims to sell stock at a premium to its current share price, according to one of the people.
Years of losses and a high debt load are severely restricting Jet Airways’s ability to expand its fleet aggressively, Mumbai-based brokerage IIFL Holdings Ltd. wrote in a 26 September research report. The market share of Jet Airways has fallen in the past four years as the number of local carriers almost doubled to 11, according to data from the aviation regulator.
Discussions on the fundraising are at a preliminary stage, and there’s no certainty they will result in a transaction, one of the people said. A spokeswoman for Jet Airways said she couldn’t immediately comment. Jet Airways sold a 24% stake to Etihad in 2013, becoming the first Indian carrier to receive investment from a foreign airline after the government eased rules. Founder Naresh Goyal owns 51% of Jet Airways, data compiled by Bloomberg show.
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Source: Mint