Jet, Sahara stock up on legal ammo
Two sides are expected to settle for arbitration since the agreement between them provided for this option.
By TNN |
NEW DELHI: With their Rs 2,300-crore deal having gone sour, the Sahara Group and Jet Airways were in hectic consultations with lawyers on Thursday even as the Lucknow-based Sahara Group regained control of its airline and the home ministry finally provided the controversial security clearance to Jet chairman Naresh Goyal. The green light would clear the cloud over Mr Goyal heading Jet Airways and is relevant for his future businesses in India too.
It is understood that both Jet and Sahara are in talks with legal eagles like KK Venugopal, FS Nariman and Harish Salve to represent their case. Sources close to the deal said the two sides are expected to settle for arbitration since the agreement between them provided for this option in case the deal fails.
Meanwhile, the Lucknow sessions court is expected to hear the case related to freezing on the Jet-Sahara deal escrow account on Friday. The Sahara Group had won an order restraining Jet from withdrawing any of the Rs 1,500 crore kept in the escrow account maintained by ICICI Bank.
The Sahara Group has also filed a caveat at the Lucknow bench of the Allahabad High Court pleading that the company should be heard before any order is passed in the ongoing dispute with Jet. While totally withdrawing from the operations of Air Sahara — which was being run as a subsidiary — the Jet Airways managements focused on preparations for the legal battle. The home ministry’s clearance for Mr Goyal is of little relevance for the deal which has collapsed. However, Jet could cite the timing of the clearance — it did not materialise before the deadline — to justify scrapping of the deal.
Sources said the Sahara Group has infused Rs100 crore to meet the immediate needs of its airline.
It will take more time before the civil aviation ministry forwards the clearance to the Directorate General of Civil Aviation (DGCA), the government arm authorised to convey such clearances to airlines.
This will ensure that the airline does not face a cash crunch due to withdrawal of Jet, the sources added. It is estimated that nearly 400 people — primarily middle management executives — left Air Sahara during the past six months.
It is understood that both Jet and Sahara are in talks with legal eagles like KK Venugopal, FS Nariman and Harish Salve to represent their case. Sources close to the deal said the two sides are expected to settle for arbitration since the agreement between them provided for this option in case the deal fails.
Meanwhile, the Lucknow sessions court is expected to hear the case related to freezing on the Jet-Sahara deal escrow account on Friday. The Sahara Group had won an order restraining Jet from withdrawing any of the Rs 1,500 crore kept in the escrow account maintained by ICICI Bank.
The Sahara Group has also filed a caveat at the Lucknow bench of the Allahabad High Court pleading that the company should be heard before any order is passed in the ongoing dispute with Jet. While totally withdrawing from the operations of Air Sahara — which was being run as a subsidiary — the Jet Airways managements focused on preparations for the legal battle. The home ministry’s clearance for Mr Goyal is of little relevance for the deal which has collapsed. However, Jet could cite the timing of the clearance — it did not materialise before the deadline — to justify scrapping of the deal.
Sources said the Sahara Group has infused Rs100 crore to meet the immediate needs of its airline.
It will take more time before the civil aviation ministry forwards the clearance to the Directorate General of Civil Aviation (DGCA), the government arm authorised to convey such clearances to airlines.
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This will ensure that the airline does not face a cash crunch due to withdrawal of Jet, the sources added. It is estimated that nearly 400 people — primarily middle management executives — left Air Sahara during the past six months.
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