Mumbai: In what could be one of the biggest airlines deals in India, Jet Airways is to buy out Air Sahara to create an airline that could finally overshadow the government-owned airlines.
The deal approximately worth $560 mn (Rs 2,500 crore) was reportedly struck between the two players late on Tuesday night.
It will give the consolidated company a marketshare of 50 per cent. Jet's dream of flying to the United States could also be realised as Air Sahaha flies there.
Air Sahara declined to comment and Jet Airways has denied the deal. Air Sahara had earlier admitted to being on the block.
It had appointed Ernst and Young as consultants who had valued Air Sahara at $750 million - a rate that analysts found exhorbitant.
The move comes close on the heels of liquor baron Vijay Mallya's announcement that he is withdrawing from the race to buy Air Sahara.
He had also said that he had market information that Jet was going to buy Air Sahara.
The deal was first reported in the middle of 2005 and was the focus of intense speculation with Kingfisher’s Vijay Mallya and Jet’s Naresh Goyal in the running.
Goyal had denied the deal on every single occasion. But while Vijay Mallaya made all the loud noises, Goyal seems to be flying off with the Sahara cake.
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