Lenders of Jet Airways, led by State Bank of India (SBI), have decided to seek resolution for the grounded airline under the Insolvency and Bankruptcy Code (IBC) after a failed stake sale attempt and harrowing search for new investors.
“A meeting of lenders was held today to consider the way forward in respect of Jet Airways. After due deliberations, Lenders have decided to seek resolution under IBC since only a conditional bid was received and requirement of the Investor for SEBI exemptions and resolution of all creditors is possible under IBC. Lenders led by State Bank of India have been taking efforts to find a resolution for Jet Airways outside IBC but in view of the above, lenders have decided to seek a resolution within the IBC process,” the statement said.
The airline stopped operations on April 17 burdened with outstanding loans of Rs 8,500 crore and liabilities worth Rs 25,000 crore. In the past few weeks, lenders have held talks with potential investors like Etihad and the Hinduja Group in hope of reviving Jet but there was no formal proposal.
“It is over. It has become like a garage sale, and difficult to see who would like to put money in this. It is difficult to explain the way banks have handled this. This clearly has been an absolute waste of time,” said Mark Martin, founder of aviation advisory firm Martin Consulting LLC.
The National Company Law Tribunal (NCLT) is scheduled to hear insolvency petitions filed by the airline’s operational creditors for recovery of dues on June 20.