Etihad takes 24% Jet Airways stake
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Etihad Airways has acquired a 24% stake in Jet Airways to form a new strategic alliance between the two airlines.
By investing a total of USD600 million in the India-based carrier, Etihad will expand its codeshare agreement with Jet and the two will combine their networks to and from India and Abu Dhabi.
Etihad has put USD379m into the equity investment with a further USD220m to be plugged into their development in an alliance.
As part of the deal Etihad purchased three of Jet’s Heathrow slots for US70m although the latter will continue to operate the flights. Flight options between India and Abu Dhabi will be expanded under the deal.
“The Indian market is fundamental to our business model of organic growth partnerships and equity investments. This deal will allow us to compete more effectively in one of the largest and fastest-growing markets in the world,” said James Hogan, president and CEO of Etihad.
Naresh Goyal, chairman of Jet Airways said the deal will help the carrier return to profitability.
“I am extremely happy to be in a partnership with an airline that shares our customer-centric operational philosophy and ethos. I have no doubt that this partnership with Etihad Airways is a win-win situation for all our stakeholders, especially our guests, who will now have access to a much expanded global network,” he said.
“This transaction further strengthens the balance sheet of Jet Airways and, more importantly, underpins future revenue streams, which will accelerate our return to sustainable profitability and liquidity,” he added.