Jet Airways might be heading for bankruptcy as it seems to have lost the chance to secure a buyer.
Will Jet Airways fly again? That’s the question everyone has been asking ever since it shut operations in mid-April. The only meaningful assets that it has, airport slots (about 766), will go permanently to rivals by July-end if it is unable to find a buyer and fly again by then. And the only two entities interested in buying it — Etihad and Hinduja Group — are reported to have made it clear that they don’t want to take majority stake in the airline. That leaves bankers, who are owed 8,500 crore out of Jet’s total liabilities of over 17,000 crore, with no options.
With most of its prized assets gone, Jet, by all accounts, is in a bigger mess than Kingfisher Airlines ever was considering that the latter owed banks just 6,000 crore when it went bust. A large number of Jet’s grounded planes have gone back to lessors, and some of them (21 Boeing 737s) have been taken over by rivals SpiceJet and Vistara. Over 4,000 employees out of 14,000 have left the airline over the past few months, including CEO Vinay Dube, CFO Amit Agarwal and CPO Rahul Taneja. An airline typically needs 120-150 employees per aircraft. Assuming that it resurrects with 60odd planes, as suggested by advisor McKinsey & Co, it will require 9,000 people. Though it has the required numerical strength, the exodus of key personnel, including pilots, to rival airlines will prevent a smooth take off (see How Others Are Gaining).
The Bank Push
A revival seems wishful thinking. The lenders, particularly SBI, have been running helter-skelter to find a buyer after Etihad submitted a conditional bid last month for re-investing in the airline in exchange for a minority stake. In the last week of May, the lenders had asked for two weeks to find a domestic investor as they are reluctant to invest more — they promised 1,500 crore funding in February but later backed off and decided to auction the airline.
هذه القصة مأخوذة من طبعة June 30, 2019 من Business Today.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك ? تسجيل الدخول
هذه القصة مأخوذة من طبعة June 30, 2019 من Business Today.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك? تسجيل الدخول
'Gap between haves and havenots is narrowing"
Tanvee Gupta Jain, Chief India Economist of UBS Securities India, on India's consumption story and the risks to the Indian economy
Rural Hope, Urban Fears
Industry enthused by signs of a revival in rural demand, but fresh concerns emerge over urban consumption
CRASH LANDING
The Supreme Court's order to liquidate Jet Airways, after prolonged insolvency proceedings, brings the focus back on the actual effectiveness of IBC
Indictment and its Aftermath
US prosecutors' decision to press charges against Gautam Adani and others in a case of alleged bribery could hit the group's ambitious expansion plans
"Moving to cloud helped us grow❞
What was the problem you were grappling with?
She's Got Time
MORE WOMEN ARE BECOMING WATCH CONNOISSEURS, SEEKING OUT BOTH JEWELLED AND TECHNICAL WATCHES FOR THEIR STYLE AND CRAFTSMANSHIP
RISING STAR
PARUL GULATI IS a name that's been steadily gaining prominence in the Indian entertainment industry after she appeared on season 2 of Shark Tank in 2023. She has become a multifaceted personality who effortlessly transitions between acting and entrepreneurship.
Building on a Legacy
WHEN ZAHABIYA KHORAKIWALA stepped into her role as Managing Director of Wockhardt Hospitals over a decade ago, she confronted formidable challenges that have since turned into achievements.
LEADER IN INNOVATION
AS FEDEX'S PRESIDENT (Middle East, Indian subcontinent and Africa), Kami Viswanathan has a lot on her plate.
WAITING IN THE WINGS
Here are those who missed out as they have not yet completed a year in office; they'll be strong contenders in 2025