At least two potential suitors have made unsolicited bids for Jet Airways (India) Ltd while minority shareholder Etihad Airways has also offered to invest in the grounded airline, albeit with conditions.
The loss-making carrier, which owes more than Rs 8,000 crore to creditors, had suspended its operations in April after lenders led by State Bank of India rejected its request for emergency funding. The SBI-led consortium of lenders had also started a process to find a buyer for Jet.
SBI Capital Markets, the investment banking arm of SBI, which is overseeing the sale process, had last month shortlisted four bidders who had expressed initial interest to invest in Jet. These four were Gulf carrier Etihad, private equity firms TPG Capital and Indigo Partners, and the Indian government-backed National Investment and Infrastructure Fund (NIIF).
The lenders are offering a stake of up 75% in Jet. Friday was the last day to submit binding bids.
“We have got two unsolicited bids and one [bid] is expected,” SBI chairman Rajnish Kumar told reporters on Friday.
Kumar didn’t reveal the identity of the bidders. However, a person familiar with the development said that TPG, Indigo and NIIF had not submitted any bids till the 6 pm deadline.
Only Etihad submitted a bid for Jet within the deadline, the person added.
Separately, news agency Reuters cited an Etihad spokesman as saying that the airline was interested in re-investing in the Indian carrier, subject to certain conditions. The spokesman said that Etihad “cannot be expected to be the sole investor” and that additional investors would need to provide most of the funds Jet needs to start flying again.
SBI chairman Kumar said that, as leader of the consortium of 26 lenders, the state-run bank had made “disproportionate efforts” to keep the airline flying in the larger Interest of the aviation sector and the economy.
He added that the ailing airline’s exposure of about Rs 1,600 crore, including interest and other payments, were a small portion of SBI’s bad loans.
On not disbursing the emergency funding of Rs 1,500 crore as requested by Jet, Kumar said: “When we put any money, commitments are on the basis of prevailing situation. If conditions are not met, money cannot be lent.”