A section of Jet Airways’ employees has now chosen to bid for the airline that is grounded and is looking for investors to start flying. These employees have written a letter to State Bank of India chairman Rajnish Kumar requesting him to consider their bids, as they can arrange funding of up to Rs 7,000 crore for the airline over a period of time.
In a letter sent on Monday and reviewed by ET, the employees of the airline have stated they would come together – with the help of external investors – to revive the airline.
“On the basis of extensive discussions with various employee groups across the company, and also with colleagues, who have held management positions in the past, we would like to suggest that Jet Airways can be taken over by a consortium of employees and external investor(s),” read a letter to SBI chairman Kumar.
The group of employees, however, do not have the support of the current top management, ‘who the employee representatives feel is still working for the airline promoter Naresh Goyal rather than working for the company’.
The letter calculates that ‘employee-led turnaround is modeled on the similar turnarounds in the west like that of United Airlines in 1994.’
The letter – signed by P P Singh, senior vice-president (operations), general secretary of Society of Welfare of Indian pilots Ashwani Tyagi, president of Jet Aircraft Maintenance Engineers Welfare Association Asish Kumar Mohanty – says that they have an investment commitment of Rs 3,000 crore.
“As per our initial estimate, the contribution of employee group over a hypothetical five-year Employee Stock Ownership Programme (ESOP) is likely to be upward of Rs 4,000 crore. In addition, we are also confident of securing an investment commitment of up to Rs 3,000 crore from outside investors,” the letter reads.
Jet Airways, which was struggling with its finances since the end of last year, finally grounded aircraft and ceased to operate since April 17, 2019, due to severe cash crunch. The banks have then called for bids to find new promoters for the airline – Etihad, TPG, and NIIF have shown interest to bid for the airline. The final winners are likely to be finalized by May 10, 2019.