Jet ready to make a dash for cash

Mumbai: Jet Airways is in a mad scramble to raise money even as chairman Naresh Goyal grapples with one of the worst human resource disasters that any airline can face in the form of a pilots’ strike.
Goyal may soon have to confront another looming problem: Jet’s fund-raising efforts are in danger of going awry.
With a debt burden of Rs 16,188 crore on its books, the Rs 11,450-crore airline is in a desperate need for cash.
Jet Airways has been talking to bankers to raise roughly $400 million through a qualified institutional placement (QIP).
Sources say it may have to scale down the figure to $300 million. “The question is not how much Jet needs, but how much it can manage to mop up through a QIP,” said an investment banker.
“Jet is in the process of appointing bankers for the QIP. The management has been talking to institutional investors both in India and overseas, including some Singapore-based funds but the response so far has been tepid. The strike will only worsen the perception,” he said.
The Street has already begun drawing comparisons between Jet and a number of real estate companies that had totted up huge debt numbers and even faced the prospect of bankruptcy.
11/09/09 The Telegraph

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Categories: Jet Airways Sep 2009