Private equity majors TPG Capital and Blackstone are understood to have submitted bids for Jet Airways’ entire stake in its loyalty programme, Jet Privilege, for $350 million to $400 million, according to people familiar with the development.
Jet Airways is expecting more than $500 million as the frequent flier programme is valued at more than $1.13 billion according to some estimates. Jet Airways holds 49.9% stake in Jet Privilege. The balance 50.1% was purchased by Etihad Airways in 2014 for $150 million as part of the Abu Dhabi-based airline’s investment in Jet Airways.
Keen on aviation
When contacted, TPG Capital declined to comment. TPG, however, is familiar with the aviation sector and had invested in airline companies globally. It was also keen in investing in the aviation sector in India as well, they added.
A Jet Airways spokesperson declined to comment saying it was speculative in nature. A response from Blackstone was awaited till going to the press.
The stake sale is part of Jet Airways’ plans to mobilise resources to meet a crisis situation arising out of mounting losses and rising fuel prices. Last month, the airline’s board had approved the proposal from the management. According to investment banking officials, Indigo Partners and GIC are also in the race to pick up stake in Jet Privilege.
