Abu Dhabi national carrier Etihad has bought Jet Airways’ three pairs of slots at London Heathrow airport for $70 million.
This is seen as Etihad getting a step closer to picking stake in the Indian carrier. A slot is the scheduled time of arrival/departure made available to an airline to operate regular flights.
The deal news sent Jet shares soaring 19 per cent to Rs 534.85 on the BSE. Sources indicated that eventually Jet will land the $70 million. The Indian carrier will be able to use the three slots at Heathrow. Jet operates two daily flights to London from Mumbai and one from Delhi.
“The purchase is part of a sale and lease back agreement signed on February 26,” Etihad said in a statement.
The deal further strengthens the existing commercial relationship which started in July 2008 and makes provisions for code share between the two airlines. “Etihad Airways continues to progress discussions about further investment in Jet Airways,” it said.
Neither carrier has revealed the contours of the deal nor when it is likely to be concluded. The Centre for Asia Pacific Aviation (CAPA) feels Etihad will acquire 24 per cent in Jet Airways for some $330 million.
Jet Airway officials did not respond to phone calls or text messages.
According to industry analysts, the three London slots may be used by Jet Airways to launch more flights. Etihad is unlikely to use these slots for now. Also, with the Government withdrawing all international slots, including to London, allotted to Kingfisher Airlines, Air India and Jet could become eligible for these slots as the only Indian carriers operating to London.
K. G. Vishwanath, Jet’s Senior Vice-President, Commercial Finance and Investor Relations, had recently said that by the second or the third quarter of this financial year, the airline will start getting back all the Boeing 777s leased to Thai Airways.
“We can either give the aircraft on lease to some other airline and there are discussions which are happening, or even operate them on our own,” he had said. The aircraft can be used to operate flights to London and possibly onwards from there.