Jet, Sahara extend pact

New Delhi, March 23 | Updated: Mar 24 2006, 05:30am hrs
The Rs 2,200-crore deal by Jet Airways to buy out Air Sahara is in a limbo after the two sides failed to reach a consensus on a renegotiated price on Thursday. The two companies, however, agreed to extend the agreement by three months. Closed door meetings continued even after Jet chief Naresh Goyal left for Mumbai late evening.

Sources said discussions were stuck after Jet offered to renegotiate the deal at a substantially lower price of between Rs 1,200 crore and Rs 1,500 crore.

Neither side, however, confirmed these numbers. Sahara, it is believed, is firm on the original price of Rs 2,200 crore.

The meeting is continuing. We have time till midnight, Mr Goyal told media earlier in the day. Air Sahara CEO Rono Dutta, when contacted by FE, refused to comment while Jet executive director Saroj Dutta was not available on the phone. Earlier in the day, Mr Goyal and his team air-dashed from Mumbai to Delhi on the penultimate day of the deadline to finalise the deal.

Teams of the two airlines kept the media in a tizzy by changing the venues of their meetings. They first met at Maurya Sheraton in south Delhi and later moved to The Oberoi in central Delhi to finalise the nitty-gritties of the agreement. The escrow account opened by Jet to give effect to the deal expires on Friday.

There is still no word so far on clearance of Air Saharas application to the Directorate General of Civil Aviation (DGCA) for share transfer agreement. This has fuelled speculation about an extension of the last date for the escrow account beyond March 24.