Jet Airways shares surge 8 pc after Etihad deal
SHARES of Jet Airways on Tuesday surged 8 pc in early trade after the 2,058 crore-deal with Abu Dhabibased Etihad was approved by the Foreign Investment Promotion Board (FIPB). Etihad will hold 24 pc stake in the domestic carrier, and FIPB's approval was based on major riders to maintain effective Indian control over the airline.
Cheering the move that was announced after the market hours on Monday, shares of Jet Airways opened the day on a positive note and as the trade progressed, it further gained 7.95 pc to 445 on the BSE.
At the NSE, the stock zoomed up by 8 pc to 444.
However, later the scrip pared most of its gain on profit-booking and was trading flat with 0.02 pc gain at 412.30 on the BSE.
Over the past two trading sessions, Jet shares have gained 22.38 per cent.
Under the conditions set by FIPB, Jet will have to seek prior government approval to make any changes in the Share Holders Agreement (SHA) with Etihad or any change in shareholding of the company.
The conditions also include that all shareholder disputes and disputes under SHA would have to be adjudicated under Indian law as opposed to English law as was proposed in the revised SHA submitted just before the FIPB meeting. Any other arbitration can happen under English law.