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aviation | IST

Jet Airways deal will be a "win-win" for Tatas and Naresh Goyal, says former ED of Air India

Jet Airways deal will be a "win-win" situation for both Tata Sons as well as Naresh Goyal, said Jitendra Bhargava, former executive director of Air India, adding that the former has been "passionate about aviation" while the latter is "left with very little options".
Tata Sons board is likely to discuss the Jet Airways acquisition plan on Friday and if board approves, the proposed deal may "move quickly",  a source familiar with the developments had told CNBC-TV18.
“Let us look at from the Jet perspective first. High debt at the moment, no chance of market dynamics changing so that they can make profit. So what is the course available to them? Follow the Air India route of gradual marginalisation or the King Fisher. So there was a need for fund infusion as you rightly said but where do they get the funds from, that is the question. You should be willing to give away your stake - for Naresh Goyal, is he willing? Because he has been a promoter, he has nurtured the airline, so it is a tough call but when you look at the reality, he is left with very little options and Tatas have been passionate about the aviation, there is no denying," Bhargava said.
"...considering the desperate situation the Jet is in, I think Tatas will go for it because it is a win-win situation,” he added.
“If you look at the whole thing, Jet need money and Tatas have been desperate for a good long-time now," said Mayur Milak of IndiaNivesh Securities.
“...if at all this deal happens, the immediate requirement for funding will have to be addressed and I see that happening,” said Kapil Kaul, CEO-India Subcontinent of Centre for Asia-Pacific Aviation.
Kaul argued against Milak and Bhargava's claims saying that the Tatas were desperate. “I don’t agree to the fact that Tatas are desperate. Obviously, Tatas see this opportunity, they will try to do their best to get what is good for them if it makes strategic sense, what is the cost of the turnaround, cost of acquisition, integration, so there are many factors to it but I don’t think Tatas are desperate..."