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Sunday, February 25 2024

Jet seeks Rs 400 cr instant funds to avoid closure

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Mumbai: Jet Airways, which is on the verge of collapse, on Tuesday reportedly requested lenders for Rs 400 crore interim funding of to stave off temporary closure, even as its operational fleet shrunk to five aircraft.

According to Civil Aviation Secretary Pradeep Singh Kharola, the airline on Tuesday operated only five aircraft, down from seven on Monday. Under the current regulations, the airline is required to operate five aircraft to save its air operating permit.

In a BSE filing, the airline said in view of the critical liquidity position, its operations have been severely impacted. “The company is awaiting emergency liquidity support from the consortium of the domestic lenders, led by SBI,” the filing said.

“The company’s leadership, in consultation with its board of directors, is engaged with lenders in connection with the said emergency funding request to arrest further deterioration of its services and minimise inconvenience to its guests,” it said.

A meeting was also held at the Civil Aviation Ministry to review the spurt in airfares in the wake of Jet Airways’ troubles.

Earlier in the day, the airlines’ board meeting ended inconclusively as the airline awaited the lenders’ decision on its plea for interim funds to stay aloft.

“The board meet was inconclusive. We are awaiting the lenders’ reply. It is of paramount importance that we receive clarity on interim funding,” an airline source told IANS in Mumbai.

In a late evening letter to employees, the airline CEO Vinay Dube said the company had highlighted specific areas that would be immediately impacted if the funding was not provided.

“Please be assured that we continue to work pro-actively with the lenders to provide all the support, which may be required to help us resurrect Jet Airways, including working closely with the potential parties that are keen on bidding for the airline,” the CEO wrote.

However, the airline’s lenders said they were committed to its revival.

Punjab National Bank (PNB) Managing Director and CEO Sunil Mehta said discussions were on to provide interim funding. “Lenders are committed to Jet Airways’ revival. SBI and SBI Capital are working on a package, but it has not been finalised,” he said.

Jet Airways has almost run out of funds to pay for fuel and other operational expenses. If extra funds don’t come through then the airline might have to temporarily suspend operations.

Currently, it has folded up most operations due to the grounding of over 80 per cent of its fleet by lessors. Besides, it has also extended cancellation of international flights till April 18 (Thursday), after last week suspending them till April 15 (Monday).

It owes over Rs 8,000 crore to the SBI-led consortium of lenders. Its only ray of hope is immediate injection fund and completion of the stake sale process, initiated by lenders.

The airline’s scrip on the BSE declined by Rs 19.95, 7.62 per cent, to Rs 241.85 on Tuesday from its previous close of Rs 261.80.

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