Jet Airways To Put Global Expansion On Hold - June 16, 2008

Shanghai: Jet Airways, India's top private airline, plans to put its international expansion on hold until the end of next year because of soaring oil prices, its chief commercial officer said on Monday.

"After this flight, we will probably only launch Dubai when we get the rights," Sudheer Raghavan told Reuters at a ceremony marking the launch of its new route between Mumbai and San Fransico via Shanghai.

"After that we are going to consolidate our international operations until the end of 2009, when we get new aircraft."

Raghavan also said the airline intended eventually to conduct an equity rights issue to raise funds, but that "this is not the right time" because of high oil prices and weak global stock markets.

In April, Jet's chairman Naresh Goyal said the airline was assessing the market for the launch of a rights issue. The company had previously said a rights issue might raise up to $400 million.

Jet Airways Intends To Tap Overseas Investors

Mumbai: As the markets still look grim for a rights issue, Jet Airways, plans to tap other avenues for raising funds.

The listed airline company said its board has decided to seek shareholders approval for raising funds from overseas investors, through issue of ADRs/GDRs or FCCB or through Qualified Institutional Placements.

In a notice to the stock exchanges, Jet Airways said it would seek the approval through a postal ballot.

The private Indian carrier has been delaying its $400 million rights issue since October last year on account of unfavourable stock market conditions. In July last year, the company said the issue would hit the market in October, then it got shifted to January and then to March of 2008.

However, last week while announcing the airline’s expansion plans for international destinations, Naresh Goyal, Chairman, said that the company is open to all sources of funding and rights issue will follow once the “markets settle.”

Jet Airways officials were unavailable for comment on the board’s decision to go for alternative plans to raise funds.

According to market analysts, while the rights issue might still be on its way, a QIP is a much quicker and easier method of raising money. “Since the markets are not looking up, there are chances a rights issue will not be fully subscribed. Also, the issue would have various regulatory clearances attached, making the process more time consuming.

At the same time, if some one offers a good price, the deal would be done in one go,” said Siddhartha Khemka, analyst with ICICI Direct.

Jet has been planning the rights issue to fund the induction of aircraft and the acquisition of Air Sahara which it concluded last year.

“They need money now. As their debt:equity ratio is 5:1, the company needs to dilute equity to further fund its expansion plans,” said another analyst from a Mumbai-based broking firm.

Goyal was also supposed to dilute his holding in the company by five per cent by March 2008 in line with Securities Exchange Board of India’s guidelines. As per the regulations, the promoters need to bring down their stake in the company to 75 per cent.

Jet Airways - Notice Of Postal Ballot

Jet Airways India Ltd has informed that pursuant to the Resolution passed by the Board of Directors on April 03, 2008 the Company proposes to seek the approval of the shareholders pursuant to the provision of section 81(1A) and other applicable provisions, if any, of the Companies Act, 1956 for the purposes of authorizing the Board of Directors of the Company to issue securities such as ADRs / GDRs / FCCBs etc. to eligible investors including QIPs/ FIIs etc.
For this purpose the Company will seek the approval of the Shareholders through Postal Ballots and the Board of Directors have appointed Mr. Taizoon M Khumri, proprietor, T M Khumri & Co., Companies Secretaries, Mumbai as scrutinizer.

Jet Airways Starts Two Flights To West Asia

Mumbai: Jet Airways has unveiled two new flights in the Kochi-Muscat and Mumbai-Doha routes. The airline will fly Boeing 737-800 aircrafts on these routes. The airline is already operating daily direct flights on the Kochi-Kuwait-Kochi, Kochi-Bahrain-Kochi, Mumbai-Bahrain-Mumbai and Delhi-Kuwait-Delhi routes.

At present, Jet Airways operates a fleet of 76 aircraft, which includes eight Boeing 777-300 ER aircraft, seven Airbus A330-200 aircraft, 52 classic and next generation Boeing 737-400/700/800/900 aircraft and nine modern ATR 72-500 turboprop aircraft. With an average fleet age of 4.37 years, the airline has one of the youngest aircraft fleets in the world. It operates over 365 flights daily. Flights to 57 destinations span the length and breadth of India and beyond, including New York (both JFK and Newark) Toronto, Brussels, London(Heathrow), Singapore, Kuala Lumpur, Colombo, Bangkok, Kathmandu, Dhaka, Kuwait and Bahrain. The airline plans to extend its international operations to other cities in North America, Europe, Africa and Asia in phases with the introduction of wide-body aircraft into its fleet.

Jet Airways Looks For Approval From China

Beijing: China and the US are set to be linked by an Indian carrier for the first time, if Jet Airways is approved by the Chinese authorities to fly its proposed Mumbai-Shanghai-San Francisco route. This would also be the first direct flight link between the commercial capitals of India and China, two of the world''s fastest growing economies. Under a bilateral civil aviation pact inked in April 2005, during Chinese Premier, Mr Wen Jiabao''s visit to India, the airlines of both countries are permitted to operate up to 42 weekly flights between the two nations. However, while Chinese carriers already boast a combined 18 weekly flights, India''s Air India only runs four flights a week. During a meeting with his Chinese counterpart in Beijing on Jan 12 afternoon, the Commerce Minister, Mr Kamal Nath, brought up Jet''s case as a concern, arguing that Beijing should de-link it from the Great Wall Airline issue. In addition to daily flights between Mumbai and Shanghai, Jet also plans to link Beijing with Mumbai, as well as New Delhi.