Airlines Deals

Breaking the silence on collapse of the Rs 2,300 crore deal to acquire Air Sahara, Jet Airways today said the decision not to salvage the pact was purely on ‘commercial considerations’ and that it was moving the Supreme Court for transfer of litigation in different courts.

Terming the controversy as “unfortunate,” Naresh Goyal- controlled Jet indirectly hit out at Sahara saying that it was forced to clarify its position due to “inaccurate statements made by vested interests”.

“There is nothing more to the actions of the Parties (of not seeking extension of Share Purchase Agreement) beyond commercial considerations,” Jet said a week after the deal fell through, leading to acrimony and legal battle between the two airlines, whose proposed merger was touted as the biggest aviation deal in India.

Goyal, who has been in London even prior to the collapse of the deal, is talking to top most layweyers to handle the resultant situation.

“A transfer petition is being filed by Jet Airways before the Supreme Court,” it said, adding that litigations have ensued after the expiry of the agreement on the midnight of June 21, and proceedings are pending in the Bombay High Court (initiated by Jet) and Lucknow courts.

Sources in the know said that Jet would possibly move the Supreme Court tomorrow.

Stating that “time limits” in the Share Purchase Agreement expired before the ‘conditions precedent’ were met, Jet said in a statement: “For commercial reasons, and in the interest of Jet Airways, and its family of shareholders, the management decided not to extend the time.”

Alleging that Jet had terminated the contract, Sahara had moved the District Court in Lucknow on June 22 and sought an interim stay on operation of the escrow account and followed it up with another injuction on the sale of share pledged by it to Jet for an advance of Rs 500 crore. The issue is comming up for hearing on June 30.

While Sahara officials were not immediately available for comments, Jet said in the statement that it was constrained to clear the air by clarifying its position in the matter in view of reports based on “inaccurate statements made by vested interests.

Meanwhile, Air Sahara officials were closeted with their legal advisers to evaluate and prepare their response to Jet’s plans to move the apex court.

On June 23, the Lucknow district court had extended the interim order freezing the escrow account and restrained Jet from selling Sahara’s shares worth Rs 500 crore.

Senior advocate Abhishek Singhvi, appearing for Jet, had contended that since the petition on the issue was filed by Naresh Goyal-promoted airlines before the Bombay High Court, the Lucknow court had no jurisdiction to entertain Sahara’s petition.

However, Sahara’s counsel Dushyant Dave opposed argument on maintainability of its petition, saying that the deal was signed in Lucknow and as such the court here has full jurisdiction on the issue.

In its statement today, Jet said the share purchase agreement between it and Air Sahara was based on certain precedent conditions being satisfied before the due date of June 21.

“These conditions related to some permissions being given by the Government of India as well as certain policies relating to mergers and acquisitions of airlines being in place,” the Jet statement said.

Referring to the issue over the delay in getting security clearance of its chief Goyal, which raised questions over the “credentials” of the management, Jet said: “The latest communication by the Government of India has laid the controversy to rest — nothing more needs to be said.”