Although Jet Airways' promoter Naresh Goyal released a statement on Wednesday saying he has "signed on the dotted line as required to ensure release of the much needed funds committed by the lenders", the beleaguered airline's woes are far from over. Battling crises on multiple fronts, from grounded planes to disgruntled and unpaid employees threatening to go on strike, it may be racing against the clock to stay afloat.
"Jet Airways won't be able to operate beyond April if it doesn't get the entire promised debt funding of Rs 1,500 crore from its lenders in a week, its top management has estimated internally," sources in the know told The Economic Times.
But the recent Supreme Court ruling that struck down the RBI's February 12 circular - outlining a revised framework for resolution of stressed assets - may throw a spanner in the works. The cash-starved Jet Airways on Wednesday deferred payment of March salaries citing "complexities" in the finalisation of the debt-recast plan, under which the SBI-led consortium of lenders took over the reins of the airline last month.
The resolution plan involves converting the airline's debt into equity - a 50.1% stake - for a notional value of Re 1 per share, as per the RBI's circular, which has now been declared unconstitutional and ultra vires (acting or done beyond one's legal power or authority). Hence, the promised emergency infusion from the lenders to meet operating costs is now held up on "technical" grounds.
Jet Airways chief people officer Rahul Taneja said in a communication to staff yesterday that the airline is making every "possible effort" to remit salaries at the earliest and will provide "an update on the status of the pay-out by April 9, 2019". The airline's management has reportedly already met lenders seeking clarity on the future of the resolution plan but no clarity or assurance has been forthcoming.
Meanwhile, the airline's pilots' body, National Aviator's Guild (NAG), has deferred its no-flying call to April 15. The body, which claims to represent around 1,100 of the 1,600 Jet Airways pilots, had announced earlier that its members will not fly from April 1, unless their salary dues were cleared.
"The management has shown us a positive intent by transferring our (December) salary and we thought we should give them at least a couple of weeks to settle down and form the interim board and solve our issues which they have already spoken about earlier," NAG president Karan Chopra said on Sunday. Incidentally, it was on the NAG's pushing that the SBI-led consortium had agreed to infuse interim funding of Rs 1,500 crore.
Chopra had added that the total payout of salary for pilots, engineers and general managers and above-level executives would be in the range of Rs 320-350 crore for the period between January and March this year.
04/04/19 Business Today
To Read the News in full at Source, Click the Headline
"Jet Airways won't be able to operate beyond April if it doesn't get the entire promised debt funding of Rs 1,500 crore from its lenders in a week, its top management has estimated internally," sources in the know told The Economic Times.
But the recent Supreme Court ruling that struck down the RBI's February 12 circular - outlining a revised framework for resolution of stressed assets - may throw a spanner in the works. The cash-starved Jet Airways on Wednesday deferred payment of March salaries citing "complexities" in the finalisation of the debt-recast plan, under which the SBI-led consortium of lenders took over the reins of the airline last month.
The resolution plan involves converting the airline's debt into equity - a 50.1% stake - for a notional value of Re 1 per share, as per the RBI's circular, which has now been declared unconstitutional and ultra vires (acting or done beyond one's legal power or authority). Hence, the promised emergency infusion from the lenders to meet operating costs is now held up on "technical" grounds.
Jet Airways chief people officer Rahul Taneja said in a communication to staff yesterday that the airline is making every "possible effort" to remit salaries at the earliest and will provide "an update on the status of the pay-out by April 9, 2019". The airline's management has reportedly already met lenders seeking clarity on the future of the resolution plan but no clarity or assurance has been forthcoming.
Meanwhile, the airline's pilots' body, National Aviator's Guild (NAG), has deferred its no-flying call to April 15. The body, which claims to represent around 1,100 of the 1,600 Jet Airways pilots, had announced earlier that its members will not fly from April 1, unless their salary dues were cleared.
"The management has shown us a positive intent by transferring our (December) salary and we thought we should give them at least a couple of weeks to settle down and form the interim board and solve our issues which they have already spoken about earlier," NAG president Karan Chopra said on Sunday. Incidentally, it was on the NAG's pushing that the SBI-led consortium had agreed to infuse interim funding of Rs 1,500 crore.
Chopra had added that the total payout of salary for pilots, engineers and general managers and above-level executives would be in the range of Rs 320-350 crore for the period between January and March this year.
04/04/19 Business Today
0 comments:
Post a Comment