21 March 2019: Lenders to cashstrapped Jet Airways are looking at a change of management as part of a revival plan as the promoters, led by founder and chairman Naresh Goyal, have refused to cooperate and bring money into the company.
“He wants to retain control without bringing any money,” said a source familiar with the discussions. Goyal’s departure from what was once India’s largest airline was a key stumbling block in talks with the Tata Group as well. Apart from Goyal, his wife Anita, and Gaurang Shetty, who joined in 1996, represent the promoters on the board of directors. Although lenders have not disclosed the plan post the exit of Goyal and his nominees, they are keen to rope in other investors and would prefer domestic players, government sources indicated. Lenders led by SBI had asked the promoters, who own 51% shareholding, to bring Rs 750 crore.
Sufficient room to revive Jet Airways: SBI chairman
They would have then released a matching amount to keep the airline afloat. But instead of infusing funds, Goyal, who started out as a travel agent, lobbed the ball in Etihad’s court. Etihad has refused to invest any more money in the airline. “We are not concerned with who the promoter is. Our aim is that Jet Airways should not be harmed. There are Rs 4,000 crore worth of creditors and nobody wants to take Jet Airways to IBC (Insolvency and Bankruptcy Code),” said a banking source.
SBI chairman Rajnish Kumar told reporters on Wednesday after meeting finance minister Arun Jaitley that lenders were almost ready with the resolution plan but will need a little more time “because of certain issues”. While he did not elaborate on the reasons, another banker said that Etihad’s refusal to be part of the deal has resulted in further complications.
“Discussion with Etihad is on. Etihad will take a decision based on its assessment of the situation. It is not that they have decided that they will go out. However, they have certain conditions that the airline should be run in a professional manner,” the SBI chief said. Kumar, however, said that there was sufficient room to revive the private carrier. “
“We have not reached that point where we can say enough is enough and nothing else can be done… Every effort is being made by the lenders to keep the airline running. It is in everybody interest that Jet Airways continues flying,” he said. He clarified that the government has not given the lenders any directions and the decisions will be taken in commercial interest.