Jet unveils plan to cut debt burden

Jet Airways (India) Ltd, the country’s largest carrier by passengers, will cut debt by turning rupee loans into dollar-denominated ones, raise money through the development of land it owns, and sell at least 20 planes and lease them back.
The strategy is aimed at reducing its Rs.13,737 crore debt burden, K.G. Vishwanath, vice-president (commercial strategy and investor relations) at Jet Airways, said in a conference call with analysts on Monday.
The Naresh Goyal-promoted Jet Airways been looking to raise $400 million (around Rs.1,780 crore) for the last two-three years by selling fresh shares to qualified institutional buyers to lower debt. It wasn’t able to do so owing to delays in government approvals and the global economic meltdown.
“Jet Airways, year-on-year, will be able reduce anywhere between Rs.1,500 crore and Rs.2,000 crore of debt every year, considering the measures taken by the airline,” Rashesh Shah, an analyst at domestic brokerage ICICI Securities Ltd, told Mint.
Vishwanath, who joined the airline as a management trainee and risen to become a vice-president in 10 years, said Jet will get upfront payments of Rs.500-550 crore from Godrej Properties Ltd, which will develop the airline’s 1.47-acre plot in Bandra-Kurla Complex, a business district in suburban Mumbai.
02/11/10 P.R. Sanjai/Live Mint

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Categories: Jet Airways Nov 2010