India's largest private airlines Jet Airways Thursday inked a renewed deal to take over its rival Air Sahara for Rs.14.5 billion ($338 million), further expanding its market share in India's fast-expanding domestic aviation sector. Speaking to reporters here after the deal was sealed, Jet Airways chairman Naresh Goyal said: "The deal is 40 percent cheaper for us then the one we had signed with Sahara last year. It is a commercially good deal for Jet."

The Jet chief, however, refused to divulge further information and said: "Details of the deal would be made public on April 16." The deal was signed by Air Sahara chief Subroto Roy's close confidante Pallav Agarwal and Saroj Dutta of Jet Airways, industry sources here said. Jet Airways counsel Harish Salve said: "We, Jet and Sahara, have ended the dispute in an amicable manner. As we don't like fighting and now the dispute is a thing of the past."

The industry sources said the renewed valuation of Air Sahara has been pegged at Rs.20.5 billion, of which Rs.6 billion is expected to be liabilities and arrears. Of the remaining Rs.14.5 billion, Jet has already paid Rs.5 billion as advance in lieu of the promised shares of Sahara. It will pay the remaining Rs.9.5 billion in five interest-free instalments.

"Jet Airways has already paid Rs.5 billion and it will pay another Rs.4 billion by April 20," a spokesperson told IANS. "The balance will be paid in four interest-free instalments between March 2008-2011," she said.

Earlier in the day, a draft proposal was submitted by the two airlines to the Supreme Court-appointed three-member Arbitration Panel comprising British Judge Lord Stein and retired apex court judges S.P. Bharucha and Jeevan Reddy.

Jet, which controls almost 40 percent share of India's domestic market and also flies to some overseas destinations, struck a deal in January last year to buy Air Sahara from the Sahara group. But after the deal failed to get some regulatory approvals from the government, Jet decided in July 2006 not to pursue the acquisition, citing commercial reasons and shareholders' interests.

After the deal was scrapped, both parties moved court to stop each other from operating the escrow account of Rs.15 billion with ICICI Bank opened for the purpose.

Sahara filed a petition in the Supreme Court, requesting postponement of the proceedings until the case was heard. Jet also filed a petition in the Bombay High Court.

The apex court had appointed the Arbitration Panel and asked the two parties to settle their dispute amicably.

The two sides had begun to move towards a settlement since Sunday. High drama had marked the proceedings for the last couple of days as a core team of six people - three from either side - prepared the drafts for negotiations.

Both Jet chairman Goyal and Sahara group chief Subroto Roy had stationed themselves in Mumbai since Tuesday but kept away from direct involvement in the talks, sources said, adding they were, nevertheless, informed of every move and countermove.