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INDIA
BUSINESS WORLD -
JANUARY 2006
THE MONTH THAT WAS
JET, AIR SAHARA TIE THE KNOT
The biggest aviation deal in India has finally happened. Ending months of uncertainty, Jet Airways and Air Sahara signed a formal agreement in Lucknow . The pact paves the way for strategic alliance between the two carriers initially and fullfledged merger eventually.
There was no official confirmation as both sides kept the agreement under wraps but sources familiar with the deal said the Sahara Group would get Rs 2,300 crore for its airline. Most of the liabilities of Air Sahara are also to be taken over by Jet. Sources said Jet Airways would inform the stock exchanges about the deal tomorrow and both sides are expected to make official announcements soon after that.
It is understood that the Air Sahara brand would be retained and nurtured as a low-cost product while Jet will focus on the premium segment.
The deal was inked by Air Sahara vice president Alok Sharma and Jet Airways executive director Saroj Dutta. Sahara Group chief Subrata Roy and Jet Airways chairman Naresh Goyal cleared the final formalities today, sources said. A highlevel Jet Airways team had flown to Lucknow for the deal. Signing of the deal had become a formality after the Vijay Mallya-owned Kingfisher pulled out, leaving Jet the only suitor. The deal will lead to the creation of the country's largest airline. The merged entity will have a share of more than 50%.
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