Tata Group is considering buying the cash-strapped Jet Airways. The salt-to-steel group is conducting due diligence of the beleaguered airline as it explores the purchase of a controlling stake.
Saurabh Agarwal, chief financial officer of Tata Sons, is leading the discussions while Jet Airways is represented by its chairman Naresh Goyal, two people directly aware of the development to The Mint.
“An in-house team of Tata Sons is currently conducting due diligence on Jet Airways, which is expected to continue for the next few weeks,” said one of the two people cited above.
“Things have moved at a fast pace since then and Goyal has in principle agreed to cede control to Tatas, subject to fulfilment of certain conditions,” said the second person. “Such a condition includes how much premium the Tata Group is willing to pay for Goyal to give up control and whether he (Goyal) will continue in some capacity if the talks are successful,” said the second person.
Tata already has a presence in aviation through budget airline AirAsia India and full-service carrier Vistara, a joint venture with Singapore Airlines.
For the past three months Jet Airways has been in the news as it has been unable to pay salaries and meet operational costs. It has reportedly been in talks with international carriers for stake sale. Potential investors have shown keen interest in its highly valued loyalty program Jet Privilege.