SBI, other lenders working on comprehensive resolution plan, says debt-ridden Jet Airways
Mumbai, Jan 16 (IBNS): Amid reports of a possible bailout by Etihad Airways, Indian aviation major Jet Airways on Wednesday said currently State Bank of India and other lenders and stakeholders are working on a resolution plan to create a turnaround of the crisis hit airline.
The financial crisis-hit aviation major has defaulted on loan repayment to a consortium of Indian banks led by State Bank of India (SBI) on Dec 31, 2018.
"In order to avoid any speculation and rumours, we hereby categorically state that in line with the decisions of the Board of Directors at their meeting held on 27 August, 2018, the Company has been working on various cost cutting measures, debt reduction and funding options including infusion of capital, monetisation of assets including the Company’s stake in its loyalty program, in consultation with various key stakeholders," the aviation major said in a statement.
"Further, pursuant to a delay in the payment of interest and principal instalment due to the consortium of Indian banks, led by State Bank of India (SBI), on 31 December, 2018, by the Company, SBI in consultation with the other members of the consortium and the other stakeholders has been working on a comprehensive resolution plan towards a turnaround of the Company for its sustained growth and restoration of financial health," it said.
The aviation company said: "The said resolution plan, inter alia, contemplates various options on the debt-equity mix, proportion of equity infusion by the various stakeholders and the consequent change in the composition of the Company’s Board of Directors."
The company said the implementation of the resolution plan, once agreed to and approved by all the stakeholders, including the Board of Directors of the Company, will be subject to receipt of applicable statutory, regulatory, contractual and corporate approvals and consents.
Jet Airways said: "We wish to clarify that the resolution plan is presently under active discussion amongst the stakeholders and the various options therein, being privileged and confidential, are yet to be crystallised and agreed to by the stakeholders in the best interests of the Company."
Meanwhile, a CNBC-TV18 report said Etihad Airways has offered to pick up shares of Jet Airways Ltd at a 49 percent discount.
Etihad Group CEO Tony Douglas, in an email to State Bank of India (SBI), said his airline will invest in struggling Indian carrier Jet Airways only at Rs 150 per share, the portal reported.
Douglas said Jet Airways will not be able to continue funding its operation beyond the current week and Etihad is willing to immediately release $35 million if their conditions are met, the channel reported.
Shares of Jet Airways fell 6.20 percent in trade on Wednesday morning and were trading at Rs 274.15 per share at 0953 hours, CNCB-TV18 reported.
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