Jet, Etihad officials meet Sebi; seek to address control issue

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Representatives of Jet Airways and Etihad Airways today met Sebi officials and sought an early clearance to their Rs 2,060-crore deal from the capital market watchdog.

The meeting took place following the regulator's apprehension about the UAE carrier's indirect control of the Naresh Goyal-promoted airline, in which it acquired a 24 per cent stake, and seeking to know why the Gulf carrier should not be made to make an open offer to the Jet shareholders.

Legal representatives of Jet and Etihad are understood to have told Sebi officials about various interpretations of the word "control" under different Indian laws, sources said.

The Jet-Etihad team, which included senior executives and counsel Janak Dwarkadas, stressed on the meaning of "control" as defined under the Sebi Act and under laws governing fair trade practices, the sources said.

Sebi had reportedly issued a show-cause notice to Etihad, seeking explanation as to why it should not make an open offer to Jet's public shareholders under the rules.

According to reports, law firm Amarchand & Mangaldas and Suresh A Shroff & Co has been hired by Etihad for representation to the Sebi. Today's representation was made before Sebi whole-time member Rajeev Agarwal.

"We have presented our side and will await the final order from Sebi with regards to the case," the sources said.

The regulator in January announced a re-look at the landmark deal after the Competition Commission raised concerns over the aspect of control even though technically Etihad has picked up only 24 per cent stake in the Indian carrier.

The problem arose after Jet offered more board positions to Etihad than the former can seek under rules considering the minority stake it bought in the private carrier.

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