Jet-Sahara deal in courts, uncertainty lingers

New Delhi, June 21: Uncertainty over the takeover of Air Sahara by Jet Airways is likely to linger as the union home ministry takes a decision today on various issues, including those relating to security.

Amid speculation that Jet has threatened to walk out of the Rs 2,300-crore deal, sources in the aviation industry did not rule out the possibility of another three-month extension of the deadline for escrow account, which would expire today at midnight.

''A totality of several factors is being examined, including security clearance. The matter is under consideration and a decision on it will be taken in evening,'' said an expert.

Officials in both the airlines remained tight-lipped over developments as the country's first-ever aviation buyout seemed to have hit an air pocket with Jet pushing for a reduction up to 20 per cent in the valuation.

Jet said in a statement yesterday that they are awaiting all the regulatory approvals and the fulfillment of all conditions precedent. There were also reports that senior officials of Jet are meeting in London and Mumbai today to take a final call on the issue.

There were indications in the market that Jet is planning to withdraw from the Rs 2,300 crore buyout of Air Sahara as the latter had still not succeeded in getting the requisite approvals from the government, including security clearances, before the expiry of escrow account.

Jet Airways chairman Naresh Goyal is reported to have sent a letter on June 12 to Sahara expressing unhappiness and concern over the delays and the turn of events. As per the agreement, the onus of getting the clearance lies with the Sahara group which has already obtained clearances for four Jet nominees including Jet's executive director Saroj Dutta, former advisor to finance minister Vijay Kelkar, lyricist Javed Akhtar and senior Jet official Victoriano P Dunca.

The buyout has been mired in controversy from January when the deal was announced with detractors claiming that it would lead to monopoly in the aviation market.

Meanwhile, Jet reportedly filed a petition under the Arbitration Act in Bombay High Court followed by Sahara's reaction which moved the Lucknow bench of Allahabad High Court. Jets move has come as an aftermath to the ongoing deadlock over the re-negotiation issue.

The move is seen as a step to prevent the transfer of Rs 500 crore to Sahara.

And Vijay Mallya-promoted Kingfisher Airlines ruled out reviving plans for acquiring Air Sahara even if the deal with Jet falls flat.

''I was the first one to decline ... And even now I have no plans to enter into negotiations with Air Sahara,'' said Dr Mallya.

UNI