Monday, January 16, 2023

Jet Airways 2.0 was supposed to be a dream come true. Can it really fly out in 2023?

Finally, there is some hope for the embattled airline, Jet Airways. After four years of being stuck in limbo, the country’s once-largest private airline is all set to make a comeback to the Indian skies in 2023. A regional bench of the country’s National Company Law Tribunal (NCLT) in Mumbai, on January 13, finally allowed the transfer of ownership of Jet Airways to the Jalan-Kalrock Consortium (JKC) more than two years after it was declared the winning bidder.

 With that move, the consortium says it is ready to re-launch the airline as early as April this year. “With the NCLT latest directions, we intend to fly in Q2–2023,” a spokesperson for the Jalan-Kalrock Consortium tells Forbes India.

That could happen unless, of course, the lenders now challenge the NCLT decision at an appellate tribunal or even the Supreme Court. “With the support of all our partners and stakeholders, we are fully geared up and ready to get the airline in the skies,” the spokesperson adds.

 In October 2020, the consortium had been recognised as the successful bidder for the bankrupt airline. Back then, the consortium led by Murari Lal Jalan, a relatively unknown businessman with business ties to the UAE and Uzbekistan, had offered a total infusion of Rs 1,375 crore, including Rs 900 crore towards capex and working capital, and Rs 475 crore to settle claims of the creditors. The lenders had agreed to the plan submitted by the airline, which was later approved by the NCLT in 2021. Lenders were to also receive a 9.5 percent stake in the airlines and a part of the payment to lenders is from the sale of property owned by Jet Airways.

“JKC is fully committed to the revival of Jet Airways and all payments will be made in full compliance with the court-approved resolution plan,” the spokesperson adds. The approved plan also had a clause that stated that the amount infused by the consortium for the settlement of claims of all stakeholders would be limited to Rs 475 crore.

But over two years since, the airline just couldn’t find a way to fly, a period during which the Indian government sold Air India to the Tata Group and Akasa airline took to the skies. That’s because, for several months, the consortium and the lenders, led by the State Bank of India, were engaged in a tiff over the transfer of ownership to the consortium after the lenders said that the consortium had failed to meet all the conditions precedent mentioned in the plan.

“This is the first airline that is being revived by the Insolvency and Bankruptcy Code (IBC) court process and some delays are always expected as there is no precedent for this in India,” the spokesperson for JKC adds. “But we also believe that all delays are in the past now and all stakeholders now need to look in the future to get the airline back into the skies, which we all are committed to do.”

16/01/22 Manu Balachandran/Forbes India

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