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Onus on Jet Airways chairman Naresh Goyal to save the airline he launched 27 years ago

Sandeep Soni

Lenders to Jet Airways have asked Jet Airways founder chairman Naresh Goyal to pledge his 51 per cent stake in the airline before they release interim funding to save the airline from possible bankruptcy, says a report by the Financial Express. They have also asked Goyal and other directors to quit the airline’s board so that they could take management control. With Jet’s foreign partner, the Abu Dhabi-based Etihad Airways that owns 24 per cent in the airline, deciding not to help the airline financially, Goyal may not have too many options but to agree with the tough conditions put forward by the lenders led by the State Bank of India (SBI).

Bankers who are privy to consultations told the Financial Express that their consortium would give additional loans in proportion to their current exposure in Jet Airways, as per the plan being considered. Meanwhile, Etihad is also looking to exit the airline and it has offered its 24 per cent holding to the SBI, according to media reports.

If the partners, Etihad and the promoters cannot come to a consensus, that is not our problem,” said SBI Chairman Rajnish Kumar on Wednesday. He said the lenders were exploring ways to keep Jet Airways alive.

Kumar said the lenders were interested in Jet Airways and they are in touch with Etihad. The SBI chairman was speaking to reporters after briefing finance ministry officials on the consultations on the airline’s future.

The airline is left with just 41 aircrafts currently operational out of the 119 in total. The DGCA reviewed the performance of Jet Airways on operational, airworthiness & passenger facilitation today. Current availability of aircraft in the fleet for operation is 41 and accordingly scheduled for 603 domestic flights and 382 international flights has been drawn. However, it is a dynamic situation and there may be further attrition in coming weeks, PTI reported citing DGCA spokesperson on Tuesday.

Once India’s second largest domestic carrier, Jet Airways slipped to the fourth position in February because of its existing crisis, according to the Directorate General of Civil Aviation (DGCA) data showed on Wednesday. IndiGo led the market with 43.4 per cent market share while Jet Airways had only 11.4 per cent share. SpiceJet and Air India were on the second and third spot respectively.

Jet Airways was founded by Goyal in April 1992 and began operations in May 1993 with a fleet of four Boeing 737 airplanes on lease. The company received the airline status in January 1995 and it became a public company in July 1996.