Airlines Deals

New details emerged regarding the failed merger of Jet Airways and Air Sahara (ATWOnline, June 23) as the legal fight between the carriers escalated and may be headed for India’s Supreme Court.

In an extensive interview with India’s Financial Express, Air Sahara President Alok Sharma claimed Jet wanted to cut its $500 million acquisition price by 10%-20%, which Air Sahara “summarily rejected,” effectively killing the deal.

“The main reason behind the breakup is Jet Airways’ financial crunch,” Sharma said. “They told us, ‘Look we have a problem. We are facing a financial problem and we want you to take a cut of 10%-20%.’ We summarily rejected that.” He added that Sahara was “not willing to compromise on price” and offered an extension beyond the June 21 deadline for completing the takeover, but Jet decided to let the deal expire. “I don’t blame Jet, as I understand their market valuation has gone down in recent months, but we cannot suffer with them,” Sharma said.

Jet Airways said yesterday it was filing a petition with India’s Supreme Court to transfer to the high court all lower court cases revolving around the failed merger, including a disputed $108.5 million escrow account.