Etihad does not need to conduct tender offer for Jet Airways: SEBI

By: Mohammed Sabir

MUMBAI: The Securities & Exchange Board of India has exempted Abu Dhabi-based Etihad Airways from making any open offer to Jet Airways share holders.

According to the SEBI, all of the voluntary changes made the by the airlines have been made to ensure that there is absolute certainty that "effective control" of Jet is and continues to vest in Indian nationals and the board of Jet.

“It never was Etihad's intention to acquire control in any manner over Jet. In fact, the Shareholders Agreement and the other Transaction Documents were amended accordingly and the concerned Regulatory Authorities were satisfied that "effective control" was vested in Indian nationals before approving the FDI in Jet by Etihad,” the SEBI order said.

The Sebi had issued a notice to Etihad Airways earlier this year, asking it to explain why it should not make an open offer to Jet's public shareholders under the rules.

An open offer is required to be made if an acquirer buys at least a 25 per cent stake in a target company or if a significant change in management control accompanies a stake purchase below the threshold.

The regulator was re-examining whether there is any new material information post the nod for the deal and whether this could affect control in Jet.

Etihad bought 24 per cent equity in Jet Airways at a cost of Rs 2,058 crore.