The Foreign Investment Promotion Board on Monday approved the `2,050-crore FDI deal between Jet Airways and Abu Dhabi-based Etihad Airways subject to certain conditions. Any disputes on the shareholders’ agreement and commercial cooperation agreement will now be adjudicated under Indian law and not English law.
“We approved (Jet-Etihad) deal) with some conditions,” economic affairs secretary Arvind Mayaram said. Jet Airways assured the Indian authorities that “substantial ownership and effective control” of the airline will stay with the Jet management.
It will now be placed before the Cabinet Committee on Investment and Cabinet Committee on Economic Affairs for final approval.
In order to win FIPB approval, Jet and Etihad agreed to address concerns raised at the previous FIPB meeting by reducing the number of Etihad representatives on the 12-member Jet Airways board from three to two. The “place of business” — where key decisions are taken — will remain Mumbai, and not Abu Dhabi.
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