Etihad deal will reduce Jet's debt to $1.5 bn

Jet Airways on Friday said its 24 per cent stake sale to the gulf carrier Etihad will bring down its debt to $1.5 billion from the current $2.1 billion.

"The deal will also help us bring down our current debt of $2.1 billion to 1.5 billion," Jet Airways Senior Vice-President for commercial finance and investor relations, KG Vishwanath told the company shareholders at an Extra Ordinary General Meeting (EGM) convened to seek approval the stake sale deal with Etihad Airways.

Vishwanath said that of the total $2.1 billion debt, $700 million is on account of working capital which has been borrowed at high interest rates while the remaining $1.4 billion is aircraft-related loan.

As part of the deal, Etihad will acquire 24 per cent stake in Jet Airways for about Rs 2,058 crore. The deal marks the first investment by a foreign carrier in an Indian airline since the change in the country's FDI policy last September.

Etihad's investment would help the carrier reduce its high-cost borrowings, he said.