Jet Airways’ survival remained under serious threat after its lenders Monday deferred a much-anticipated decision to provide emergency funds to the carrier following a marathon meeting, even as its pilots’ union appealed to the lenders and the prime minister to save the airline.
Jet Airways chief executive Vinay Dube in an internal communication has said the lenders could not decide on the emergency funding and that the board of the airline will meet Tuesday to take a call on the future.
“As you are aware, we have been working with the lenders to secure interim funding for our operations. The interim funding has not been forthcoming thus far, and as a result, we have extended cancellation of international operations until April 19.
“The current status of our engagement with the lenders and other related matters shall be placed before the board tomorrow morning, where the management will seek guidance from the board on the next steps forward. We will keep you updated on all critical developments,” Dube said in a mail.
Jet Airways pilots’ union, the National Aviators Guild had Sunday deferred a decision to strike from Monday saying that it wanted to give more time to the airline ahead of the lenders’ meeting here.
On March 25, the airline’s board had approved ‘the debt resolution plan’, under which SBI-led consortium would provide an emergency loan of Rs 1,500 crore and in turn acquire a majority stake, following which founder chairman Naresh Goyal and wife Anita would leave the airline and pare his stake to around 25 percent.
But banks have so far only under Rs 300 crore has been disbursed that too in small amounts, citing procedural delays.
This left the airline canceling hundreds of flights as the airline failed to pay the lease rentals.
Currently, it has just six-seven planes for operations, way below its peak of 123 planes in December.
A meeting between the airline management and its major lender SBI last week also could not take a decision on the fund infusion.
“We were expecting some cash support at Monday’s meeting but the lenders have told the airline that they are not going to provide any funds for now…We are disappointed,” said a source in the pilots’ union.