The Hindu Business Line : Jet may need aircraft acquisition panel's nod for Air Sahara buyout

THE first step towards the integration of Air Sahara with Jet Airways has been initiated with documents seeking formal clearance for the buyout being submitted to the authorities earlier this week.

However, the acquisition may have to clear another hurdle with sections in the Government favouring approval of the proposal by the Aircraft Acquisition Committee (AAC) of the Ministry of Civil Aviation.

"The Government has to look into a number of issues including whether the airline has enough manpower and resources to manage the new entity. In the given circumstances it may be prudent to have the AAC look at the proposal," sources said. The ACC meets regularly to examine proposals of airlines and give permission for import of aircraft.

Jet Airways purchased Air Sahara on January 19 this year for $500 million. The agreement will see the entire aviation business of Air Sahara including some aircraft leases, real estate like the lounges run by it and assets like auxiliary power units and engines, being taken over by Jet Airways.

However, the deal must be cleared by the Government before proceeding further.

Meanwhile, Jet Airways has started meetings with employees to find out the option they would like to exercise on completion of the merger. Jet Airways has already indicated it would absorb senior management, pilots and technical staff among others.

The airline, however, plans to honour the reduced rates tickets that have been issued by Air Sahara. "In principle the airline intends to honour the tickets that have been issued by Air Sahara.

However, there is no general philosophy in this regard as yet although no one would like to deprive the passenger of the benefits that they are entitled to," official sources said.

Air Sahara had come out with several reduced fare schemes, including a return ticket to London for Rs 10,000.

Last date extended

The Government has extended the last date for the licensing of airports to bring them on par with international standards.

Official sources said airports now have time till March 31 to procure a licence given after a thorough inspection of all facilities and procedures.

"The airport at Puttaparthi and Kochi international are among the handful that have been licensed. The others are working towards getting the licence," an official said.

Meanwhile, the Government also decided that the airport licence would be valid for two years.

More Stories on : Mergers & Acquisitions | Airlines | Jet Airways (India) Ltd

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