Jet Airways gets no cash relief; board to discuss way forward
16 April 2019
The crisis at Jet Airways has deepened with lenders offering no relief to the cash-strapped carrier. With no eligible suitors offering to acquire stake in the ailing airline, the consortium of banks refused to disburse the promised Rs1,500-crore lifeline to Jet Airways.
Pleas by employees for stop-gap funding to keep alive the airline’s services have fallen in deaf ears and the airline is staring at a possible shutdown in the absence of funds.
Finding no money to meet even the operational cost, the company has called an emergency board meeting today to discuss the way forward.
A meeting between the Jet Airways management and the lenders on Monday failed to secure interim funding for the airline to pay dues to employees and lessors as the company does not have any asset to securitise any funding.
“As you are aware, we have been working with the lenders to secure an interim funding for our operations. The interim funding has not been forthcoming thus far... The current status of our engagement with the lenders and other related matters shall be placed before the board in the meeting scheduled for tomorrow (Tuesday) morning, where the management will seek guidance from the board on the next steps forward,” Jet Airways CEO Vinay Dube said in a statement.
On Monday, Jet Airways pilots sought the prime minister’s intervention to save 20,000 jobs and appealed to SBI for funds to keep the beleaguered Indian carrier flying and save it from the brink of collapse.
Jet Airways pilots body, the National Aviator’s Guild, appealed the State Bank of India (SBI) to release the Rs1,500 crore it proposed to infuse in the ailing carrier as part of a debt-restructuring plan last month.
The airline is operating just 6-7 planes, with almost its entire fleet being grounded due to non-payment of rentals to lessors amid severe paucity of cash.
“We would like to appeal SBI to release Rs 1,500 crore funds for the airline to help it continue operations. We also appeal Prime Minister Narendra Modi to save 20,000 odd jobs at the airline,” National Aviator’s Guild ( NAG) vice president Adim Valiani told reporters.
The airline said it has extended cancellation of all international operations till 19 April due to the fund crunch. There are only about seven flights on domestic routes that are operational.
The pilots and staff of Jet Airways, who have been planning a strike to push for pending salaries, have now put off their plans.
Meanwhile, the lenders are hoping to get a new strategic investor in place to run the airline. But the question is whether it would still be Naresh Goyal.