(MENAFN- Asia Times)
India's Jet Airways, which has been facing turbulence from rising oil prices and a depreciating rupee, and is struggling even to pay salaries, is now facing a takeover bid by the Tata Group.
The salt-to-software conglomerate, however, wants complete control over Jet Airways and the exit of its current promoters, the Naresh Goyal family. It has rejected the proposal for part-ownership or joint venture, the Economic Times reports.
However, a Jet Airways representative told a media agency that the news report was speculative.
Jet Airways chairman Naresh Goyal and his family currently own 51% of the airline and in 2013 Abu Dhabi-based Etihad Airways picked up a 24% stake. A few months ago there were reports that Etihad might sell off its entire stake by the end of this year, but it issued a denial.
Tata Group currently operates two airlines in India – Vistara with Singapore Airlines and AirAsia India with the Malaysian budget carrier AirAsia Bhd.
Overall, the Indian aviation sector is in a bind. On one hand domestic air-passenger traffic has grown by at least 16% annually over the past decade, according to the Directorate General of Civil Aviation , but this growth has been largely profitless, as intense competition and passenger price sensitivity have forced airlines against raising fares.
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