Amid Etihad Airways’ open offer talks, Jet shares dive 8 Per Cent

The stock tanked 8.28 per cent to Rs 270 on BSE. On National Stock Exchange (NSE), shares of the airline company cracked 8.39 per cent to Rs 269.05 apiece. According to media reports, Etihad Airways has offered to pick up shares of Jet Airways at a discount.

Etihad holds 24 per cent stake in the airline, as per the December quarter shareholding pattern on BSE. According to reports, Etihad might have to make an open offer in case it is hiking the stake in Jet Airways. Etihad has sought an exemption from the market regulator on preference pricing and open offer guidelines, the reports added.

Under market regulator Sebi’s norms, entities have to make an open offer in case their shareholding in listed companies goes beyond a certain threshold. The carrier has posted three consecutive quarterly losses of over Rs 1,000 crore each since March 2018.

Meanwhile, the Civil Aviation Ministry on Wednesday expressed hope that the airline, its strategic partner Etihad and lenders reach a “common plan” to deal with the situation. Jet Airways, which has also defaulted on loan repayments, is looking to raise funds and is in discussions with Etihad and lenders to chart the way forward.

There is a proposal for Etihad raising its stake in the full service from the current 24 per cent. On a question on Etihad Airways reportedly seeking exemption over the open offer, Civil Aviation Secretary RN Choubey said the issue is being discussed amongst the promoters and the lenders.

“We hope that the three, Jet Airways, Etihad and the lenders, come together and decide on a common plan,” he said here. “If any such thing (open offer exemption) is required, they will have to reach out to Sebi and it will take a call. That is something (open offer exemption) between Jet Airways, Etihad and Sebi.

Government has no direct role in this,” he said. Under Sebi’s norms, entities have to make an open offer in case their shareholding in listed firms goes beyond a certain threshold. Asked if the ministry would recommend an exemption like it did in case of SpiceJet acquisition, he said “The ministry has not applied its mind on any (open offer waiver) application for recommending any waiver.”