Jet Airways buyout: Tata Sons concludes board meeting; says no offer to cash-strapped airline yet, talks only at 'preliminary' stage

The expectation that there will be a deal announcement post-Tata Sons board meeting regarding a buyout of struggling carrier Jet Airways has been dashed to the ground with the Tatas stating that it has held only "preliminary" discussions on the matter."We would like to clarify that any such discussions to take over Jet Airways have been preliminary and no proposal has been made," a statement from the diversified conglomerate said after a board meeting.There was much speculation in the past few days that Tatas, which already run two carriers -- the full-service Vistara in a joint venture with Singapore Airlines and AirAsia India in a similar arrangement with Air Asia of Malaysia -- is planning a complete takeover of the Naresh Goyal-run airline with its international partner Singapore Airlines.[caption id="attachment_3131440" align="alignleft" width="380"]

Representational image. Reuters[/caption]The speculation has sent the Jet counter soaring over 40 percent in the past five trading sessions alone. The counter closed over 8 percent at Rs 346.85 on the BSE, whose index jumped 0.56 percent to 35,457.16. The Jet stock opened with an over 14 percent gap in the morning expecting a positive outcome from the Tata Sons board meeting.The rumour of the rescue deal by the Tatas, reportedly being brokered by the government, sent Jet shares zooming 26.41 percent on Thursday.The Tata Group wants to buy the entire company or its aircraft and infrastructure, the Economic Times had reported earlier.  "The Tatas are interested in buying out the entire airline and significantly scaling up the existing business," a top official was quoted as saying by the newspaper.According to some news reports, Goyal has agreed to give up control in the airline depending on the premium Tatas will pay the founder and chairman of the beleaguered airline.Jet Airways' deputy chief executive and chief financial officer Amit Agarwal earlier this week had admitted that the company was in talks with "multiple interested parties" for fund infusion as well as selling six of its Boeing 777 planes along with a stake in its loyalty progarmme Jet Privilege.There could also be a possibility of the Jet brand being phased out if the Tatas decide to extend the reach of Vistara, according to report in the Business Standard.Chairman and promoter Naresh Goyal along with his family owns 51 percent stake in the airline, while Gulf carrier Etihad Airways owns 24 percent in the cash-strapped airline, which earlier this week reported Rs 1,261 crore in loss for the September quarter against a profit of Rs 71 crore y-o-y, making it the third straight quarters of heavy losses. This had the airline also putting as many as six of its Boeing 777s on sale to part-fund liquidity.Media reports suggest that the parent company of Vistara, Tata-Singapore Airlines, is looking at an all-stock merger of Jet as part of the Tata group's plans to board Goyal's full-service carrier.In an exchange filing on Thursday, Jet Airways described the media reports as speculative.--With PTI inputs