New Delhi, March 21: The Rs 2,200-crore Jet-Sahara merger, which was supposed to be wrapped up by this weekend, is likely to be delayed. The civil aviation ministry has referred several issues related to the merger to other ministries, including the home ministry. Moreover, the civil aviation ministry is yet to come up with a policy on mergers of this scale.
The Monopolies and Restrictive Trade Practices Commission (MRTPC) has also issued notices to both the airlines asking them to file details of their merger pact. The Director General (Investigations) issued these notices after receiving letters written to the Prime Minister by the Left and BJP MPs, seeking probes into stock market operations prior to the deal as well as violations of the monopoly laws. But sources said this is a routine practice and nothing much can be expected from this as the “mere creation of a monopoly is as yet not illegal”.
Meanwhile, last minute attempts to iron out glitches on the Jet-Sahara merger path over staff absorption and liabilities that Jet may have to take on board continued. However, no meetings between the two promoters ? Naresh Goyal and Subrata Roy ? were held.
After months of speculation, in January, Jet had taken over Air Sahara for a reported Rs 2,300 crore and announced that the two airlines would be merged after formal regulatory approvals were granted.
However, no approval has come from the Directorate General of Civil Aviation (DGCA) as yet. The DGCA has instead advised the civil aviation ministry on the need to frame a policy on transfer of flying rights and parking slots from one airline to another. The DGCA feels that flying rights, routes, parking slots are scarce commodities and hence command a price.
Purchase of one airline by another does not necessarily mean automatic transfer of these rights. The DGCA wants the ministry to look into this and decide on how to go about this issue, especially as there may be more mergers in the near future. Officials said the government may consider striking a fee for such transfers as airlines were trading in these rights when they were buying or selling each other.
