Jet Airways climbs 3% on reports Etihad will guarantee loans worth $150 mn

Shares of Jet Airways rose as much as 3.59 per cent in the early trade on BSE, after news reports suggested Etihad Airways of Abu Dhabi has offered to guarantee loans worth $150 million that Jet Airways needs to keep the airline operational.

“As an immediate measure, Etihad has agreed to stand as a guarantor for any fresh loans to be raised by Jet Airways and has engaged at least two foreign banks, one of them headquartered in UK, to syndicate the new loans,” Livemint reported citing sources.  

In addition, the struggling airline told its pilot union on Thursday it will clear all salary dues by April and has given them a schedule outlining when the payments will be made, according to a source familiar of the matter.

Jet Airways told the union it will pay a quarter of the salary for October and 50 per cent during December. The remainder will be paid in January, along with 75 per cent of the salary for November, the source said. The remaining dues for November, salary for December and 25 per cent for January will be paid in February. In March, Jet will clear the remainder for January and February and thereafter all dues will be paid on time, the person added.

In October, rating firm ICRA had downgraded Jet Airways’ debt to “B-“, saying the rating downgrade was due to delays in the implementation of the proposed liquidity initiatives by the management, which further aggravated its liquidity strain. 

At 9:45 am, shares of Jet Airways were trading 1.82 per cent higher at 282.25 a piece on BSE, as compared to a 0.4 per cent rise in S&P BSE Sensex.