New Delhi: Jet Airways (India) Ltd. and Etihad Airways
have submitted revised documents to the government seeking to allay the
Foreign Investment Promotion Board’s (FIPB) concerns over control of
their proposed venture, saying the commercial co-operation agreement
(CCA) will not override powers vested with the company’s board.
“We confirm that the CCA will not undermine the powers of
the board of the company at any time to enter/exit from such commercial
arrangement,” according to a joint note submitted by Jet Airways and
Etihad Airways to the department of economic affairs (DEA).
Naresh Goyal-led
Jet Airways has also changed the shareholders agreement and amended the
investment agreement and the articles of association, as suggested by
the FIPB, headed by DEA secretary Arvind Mayaram, official sources said.
They said the cabinet committee on economic affairs
(CCEA) could take up the deal for approval in the next few weeks. The
CCEA will consider the proposal because the foreign investment involved
is higher than Rs1,200 crore. Earlier, the FIPB said Securities and
Exchange Board of India (Sebi) would ascertain if control rests with the
Jet Airways board, as per the revised CCA.
The FIPB had approved a proposal for Abu Dhabi-based
Etihad Airways to buy a 26% stake in Jet Airways for Rs2,058 crore with
certain riders on 29 July. The riders include Jet Airways seeking the
government approval before changing the shareholders agreement with
Etihad and any arbitration to take place under Indian law, not English
law as proposed earlier.
The two airlines agreed to reduce Etihad’s representation
on the Jet Airways board to two from three, besides vesting Goyal,
Jet’s founder-chairman, with the right to deliver a “cNAUSHAD ALAM
PGDM IST
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