Jet Airways says will conclude deal with Etihad by year-end

Jet Airways expects to conclude a $334 million stake sale to Abu Dhabi's Etihad by the year-end, the airline said, one day after posting a record quarterly loss.

Jet, which has lost money in the past six years, is awaiting approvals from the anti-trust regulator for the deal and is on course to complete the transaction during this quarter, Chief Financial Officer Ravishankar Gopalakrishnan said.

An Etihad spokesman declined to comment, after Jet's earnings announcement on Wednesday, on whether Jet's quarterly loss would have any impact on the deal. The stake sale, cleared by cabinet this month, is meant to help Jet break out of a pattern of losses in the domestic airline business.

Net losses widened to Rs 891 crore ($145 million) in the three months ended September 30 from Rs 99.7 crore a year earlier. An economic slowdown also meant lower yields, a gauge of the average fare paid per kilometre flown, Jet said on Wednesday.

A fall in the value of rupee currency, the high cost of fuel and an increase in fees at some airports also led to the loss, said country's second-biggest carrier by domestic market share.

The loss in the fiscal second quarter is the biggest ever for Jet, the first of country's airlines to publish earnings for the quarter, according to data compiled by Thomson Reuters from company filings.

Despite the sector's current problems, deep-pocketed foreign players such as Singapore Airlines, AirAsia Bhd and Etihad have been lured to the country by longer-term growth prospects.

Etihad's $334 million deal for a 24 per cent stake in Jet is the first investment by a foreign carrier in an Indian airline since the country last year changed rules to help channel capital into a sector.

"The synergy between the two airlines in terms of commercial cooperation and the kind of cost synergies that we will achieve will be significantly increasing the profitability for the airlines in the coming quarters," Jet's Gopalakrishnan said.