Saturday, October 17, 2020

CoC approves Kalrock Capital-Murari Jalan's plan to revive Jet Airways

Mumbai: Eighteen months after it shut down and sixteen months after it became the first airline company to be admitted under insolvency and bankruptcy code (IBC), Jet Airways is finally all set to make a comeback, albeit with a new owner – Kalrock Capital and Murari Lal Jalan.

The resolution plan of consortium of Kalrock Capital–Murari Lal Jalan has been approved by the committee of creditors as e-voting of the lenders concluded on Saturday. “The e-voting concluded today, i.e October 17,2020 and the resolution plan submitted by Murari Lal Jalan and Florian Fritsch has been duly approved by the CoC under section 30 (4) of the code as the successful resolution plan”, the resolution professional said in an exchange notification.

Sources said, the plan submitted by Kalrock consortium won by an overwhelming majority.

As the committee of creditors have voted for Kalrock Capital led consortium to revive the airline, with a majority, the resolution professional of Jet Airways will now have to get the plan approved by the National Company Law Tribunal (NCLT). Upon receiving the NCLT approval, they would need to apply to civil aviation ministry and corporate affairs ministry for their approvals, respectively.

Jet Airways slots at major airports and its traffic rights were awarded temporarily to other airlines. Its operating permit is dormant and would need to be made active and licences of pilots and engineers would need to be renewed. “The whole investment is contingent to the airline receiving these approvals and plan could still stumble," said a person familiar with the matter.

A civil ministry official said that slots and rights will not be an issue. "Slots and rights will go back to pool and reallocated according to size and demand of airline. There are no problems with slots," said a senior ministry official.

Claims made by financial creditors, operational creditors, and employees have ballooned to over Rs 40,000 crore, out of which claims to the tune of Rs 15,525 crore has been admitted by the resolution professional. Financial creditors such as State Bank of India, Yes Bank, and others have claimed Rs 11,344 crore but only Rs 7,459. 80 crore has been admitted.

It is expected that lenders will take a fairly large haircut on their exposure.

17/10/20 Aneesh Phadnis & Subrata Panda/Business Standard


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