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Cash-strapped Jet Airways' founder Naresh Goyal approaches Mukesh Ambani, Ratan Tata for fund infusion

FP Staff
Shares of Jet Airways rose as much as 3 percent on Wednesday while the overall Mumbai market was down 0.6 percent.

Jet Airways' founder Naresh Goyal has reportedly approached Reliance Industries Ltd (RIL) chairman Mukesh Ambani and chairman emeritus of Tata Group Ratan Tata to raise capital for his crisis-hit airline, according to a media report.

According to Mint, Ambani is yet to respond to Goyal's offer. The report added Goyal is also looking at overseas airlines as potential fundraising sources.

Meanwhile, Jet Airways has defaulted on payments to aircraft lessors and Airports Authority of India (AAI) has served show cause notice to the airline for payment delays, Business Standard reported.

Last week, the airline said it was implementing a turnaround strategy and did not seek a moratorium on loans from lenders.

The full-service carrier, which is grappling with financial woes, has also delayed payment of salaries to employees. The airline gave pink slips to 20 employees, including some senior-level executives, who were working in the airline's crucial in-flight services department, to curtail costs amid the severe cash crunch, an airline source said on Friday.

It can be noted that the airline reportedly had recently asked 15 managerial level employees from various departments including engineering, security and sales, to leave the company.

The full-service carrier is partially-owned by Abu Dhabi-based Etihad Airways. The source alleged that the airline is asking people to leave but in small batches to escape attention.

"The company is engaged in implementing board approved turnaround strategy and will make due announcements with respect to specific measures once finalised," an airline spokesperson said last week.

The airline said that as part of a routine course of business, it has a well-defined succession plan in place and is committed to create a competitive cost structure that ensures a sustainable future for itself and its stakeholders.

Jet Airways Group posted a net loss of Rs 1,326 crore in the three months ended June 2018. In the year-ago period, the carrier had a net profit of Rs 58 crore.

Along with the quarterly results, the airline's board, during its meeting on 27 August, also considered various cost-cutting measures, debt reduction and funding options, including an infusion of capital and monetisation of assets.

"Given the challenging business environment, Jet Airways has been implementing additional measures to reduce costs and achieve greater efficiencies of operations," it said in a release on 27 August.

With inputs from PTI

(Disclosure: Reliance Industries Ltd is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd)

Also See: Cash-strapped Jet Airways calls off ATR planes wet leasing deal with TruJet

Cash-strapped Jet Airways hands over pink slips to 20 employees including senior-level executives to curtail costs

Jet Airways fails to give date for payment of September salaries of senior staff, pilots

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