* Terms yet to be finalised - Jet
* Etihad may pay up to $330 mln for 24 pct stake in Jet -
* Jet shares surge 6.4 pct
(Adds details, background)
NEW DELHI, Jan 3 (Reuters) - Jet Airways said on
Thursday that it was in talks with Abu Dhabi's Etihad Airways
for a potential stake sale in the Indian carrier, although terms
have not been finalised yet.
The statement was the first confirmation of a potential deal
by either side, a day after an Indian government source said the
Gulf carrier could pay up to $330 million for a 24 percent stake
Jet shares surged as much as 6.4 percent on Thursday. The
stock has risen 65 percent since India relaxed rules allowing
foreign airlines to buy up to a 49 percent stake in local
carriers in September.
"Various structures are being explored by the legal and
commercial teams," Jet said in a statement to the Bombay Stock
Exchange, adding any structure would comply with Indian rules.
The founder of Jet Airways is likely to convert shares owned
by its holding company into his personal stake to comply with
foreign investment regulations, a government source had said.
Tail Winds Ltd, the Isle of Man-based investment vehicle of
Jet founder Naresh Goyal, currently holds 79.99 percent of Jet
Etihad declined comment.
Etihad and Jet already have a code-sharing agreement, and a
tie-up could make Jet a more formidable competitor to
state-owned Air India, while strengthening Etihad's position
against Dubai-based Emirates Airline, which carries a
big chunk of the traffic between India and the Middle East.
A deal between Jet and Etihad could shut the door on
grounded rival Kingfisher Airlines, which is in
desperate need of cash to fly again and was in talks with Etihad
to sell a stake.
Etihad's decision to buy into Jet may be announced in 10
days, the same source quoted earlier said on Wednesday.
Etihad, which expanded globally through stake purchases in
the likes of Air Berlin and Virgin Australia,
is looking to extend its geographical reach to India and other
Asian markets, its chief executive told Reuters in
(Reporting by Anurag Kotoky; Additional reporting by Praveen
Menon in DUBAI; Editing by Alex Richardson)