A resolution plan for crisis-hit carrier Jet Airways may be finalised in a week’s time, a senior State Bank of India (SBI) official said on Friday.
The official, who did not wish to be named, said that the airline’s lenders were working on a comprehensive plan to keep the Naresh Goyal-led airline running.
“It is a work in progress, very soon we will have a solution,” said the SBI executive. "We have to align and take care of all stakeholders. The situation is so complex in any corporate account so it will take time.”
The lenders, led by SBI, are currently in talks with the airline’s chairman Goyal and Etihad Airways, which has a 24% stake in Jet. Over the past few weeks, they have been exploring a rescue deal which could involve a mix of equity infusion, debt restructuring and sale or leaseback of aircraft.
India’s second-largest airline is saddled with debt of over Rs 8,000 crore, of which it needs to repay Rs 1,700 crore by the end of March. It has already defaulted twice on its repayments and almost half of its fleet has been grounded due to the non-payment of its debt to lessors, and a want for spare parts.
Apart from loan defaults, Jet has not paid its pilots, leasing firms and suppliers for months. Lessors have grounded more than three dozen of its planes pending payment of dues, forcing hundreds of flights to be cancelled troubling hundreds of customers.
"It is our desire that this airline keeps running, That is the fundamental difference between this and other NPA (non-performing asset) accounts," the SBI official added.
On whether emergency funding was being arranged for to cater to the airline’s immediate needs, the SBI official said that a comprehensive solution was needed and “not patchwork”.
Earlier this week, it was reported that Goyal had sought urgent funding of Rs 750 crore from equity partner Etihad, citing 'the very precarious' position of the airline following lingering cash flow issues.
Punjab National Bank head Sunil Mehta and Bank of India MD and CEO Dinabandhu Mohapatra, who are part of the lenders’ group, had said on Thursday that while no fresh loans were being extended to Jet Airways, the lender would support the SBI-led debt resolution plan for the airline.