A Jet Airways plane readies for takeoff. Photo: iStock
Jet Airways operated its last flight on April 17 last year and became insolvent in June after being in service for 25 years. Photo: iStock

After posting weak third-quarter results, India’s second-largest airline Jet Airways is reportedly in talks with Tata Group, which had earlier expressed interest in buying the troubled airline.

The Tata Group is said to be conducting due diligence of Jet Airways as it looks to purchase a controlling stake in the cash-strapped airline and the process may take few weeks.

Top Tata officials are holding discussions with Jet Airways chairman Naresh Goyal, Mint newspaper reported.

The salt-to-software conglomerate wants Goyal to give up operational control of the airline. Goyal is willing to cede control subject to certain conditions, the daily added. Goyal and wife Anita own 51% in the airline, while UAE’s Etihad Airways has a 24% stake.

Earlier on Monday, the airline posted a net loss of 12.6 billion rupees ($173.5 million) in the third quarter of 2018-19. Total revenue, however, rose 6.9% to 63.63 billion rupees on a year-on-year basis, with the gains coming from international routes and passenger feed from partner airlines.

The management blamed a 50% rise in fuel prices, the weak rupee, and a challenging pricing environment for the poor performance. This was the airline’s third successive loss, thus making an infusion of funds critical for the carrier.

The Tata Group currently has two aviation joint ventures – Vistara, a full-service carrier with Singapore Airlines, and a low-cost carrier with Malaysian budget airline AirAsia.

However, they both are low-key players and acquisition of Jet Airways would boost its combined market share from 8.2% to 24% as of the end of September.

If talks with Jet succeed, Tata group may revamp its existing aviation ventures and align them with Jet.