Final chance for Jet Airways

Lauren Eldershaw
By Lauren Eldershaw April 8, 2019 12:00

Final chance for Jet Airways

Missed fuel payments have grounded what remains of Jet Airways fleet over the weekend and the consortium of banks that now own the airline has launched a desperate attempt to find a new owner. The airline needs $144million to keep flying. Bidders have been given until Wednesday (April 10) to submit their interest in acquiring a 75% stake.

The terms of any bid were set out on SBI Capital Markets’ website, which is a subsidiary of SBI, the lead consortium bank.  The notice states that individuals, including foreign nationals, as well as a consortium of up to three companies are allowed to bid for a stake in the airline subject to Indian laws. Bloomberg has suggested that PE firms, KKR, Blackstone, TPG Capital are in talks with consultancy firms to conduct due diligence in Jet.

Although founder Naresh Goyal has stepped down as chairman, he still owns a stake in the airline, reduced to 25.5%. The consortium banks own just over 50%, with Etihad owning 12%.

Jet Airways financial position has been steadily worsening. On April 2, Jet Airways reported that a further 15 aircraft had been grounded by lessors, and on March 28 it defaulted on its payment to global lenders. Many aircraft lessors have already applied to de-register their aircraft on the ground at Jet Airways, with some opting to move their assets to other Indian carriers.

Jet Airways’ debt now tops $1.2bn and it is months behind on salary payments to all staff members, including pilots. Finding a buyer to operate the carrier as an airline will be a difficult sell but with thousands of job losses at state, the Indian government will be keen to broker a deal especially as federal elections are being held this week.

Lauren Eldershaw
By Lauren Eldershaw April 8, 2019 12:00