Published: Tue, March 26, 2019
Money | By Arnold Ball

Jet Airways chairman Naresh Goyal, wife resign amid debt crisis

Jet Airways chairman Naresh Goyal, wife resign amid debt crisis

Goyal will cease to be the chairman of the airline.

Abu Dhabi's Eithad Airways, which owns a 24 per cent stake in Jet Airways, is however reticent to provide interim funding of about 7 billion rupees (USD 99 million) to Jet Airways, the source said.

Expression of interest for bids will be floated by April 9 and the deadline for binding bids is April 30, Kumar said, adding, a new investor is expected to be on board by May 31.

It has formed an Interim Management Committee (IMC) to oversee the financial and operational performance of the airline under the supervision of the board of directors with the support of McKinsey & Co. "There is no legal bar on anyone with a funding and revival plan in place".

Naresh Goyal has quit as the chairman of Jet Airways (India) Ltd, stepping down from the board of the airline he founded two-and-a-half decades ago, as part of a plan that involves lenders taking control of the carrier.

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It is likely that the lenders will take over more than 50 per cent of the airline's stake. There were delayed payments to vendors, banks, pilots and lessors, which resulted in the airline having to ground almost 40 of its aircraft. His government urged state-run banks to rescue the airline without pushing it into bankruptcy, sources have told Reuters.

Experts also made it clear that the airline needs a swift capital infusion to stay afloat.

The board decisions come as the full-service airline struggles to repay its debt of almost Rs 8,000 crore to banks led by State Bank of India.

At present, Jet Airways is operating with just 41 planes out of its fleet of 119 planes after failing to repay rentals.

Even as news of Goyal's departure led to a rally in Jet's shares, which ended the day 12.4 percent higher, analysts say there is still a long road ahead.

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