Lenders 'reasonably hopeful' of Jet stake sale success

Hours after denying a lifeline to Jet Airways which suspended its operations for want of cash, the airline's lenders led by the State Bank of India on Thursday said they are "reasonably hopeful" that the stake sale process would succeed and determine a fair value of the enterprise.

"Lenders are reasonably hopeful that the bid process is likely to be successful in determining the fair value of the enterprise in a transparent manner." a statement said.

The official statement said the lenders after due deliberations decided that the best way forward for the survival of Jet Airways was to get the binding bids from potential investors who have shown expression of interest (EOI) and have been issued bid documents on April 16.

Late on Wednesday night, Jet Airways in a regulatory filing to BSE had announced temporary suspension of its domestic and international operations. The decision was taken by the airline as no emergency funding came from its lenders.

"Since no emergency funding from the lenders or any other source is forthcoming, the airline will not be able to pay for fuel and other critical services to keep the operations going. Consequently, with immediate effect, Jet Airways is compelled to cancel all its international and domestic flights," the airline said in its filing.

Over the last few weeks, the crisis-hit airline tried to secure interim funding to keep the business going but its request did not find favour from its lenders.

Unable to meet expenses, the airline gradually scaled down its operations and was flying just 6-7 aircraft from the peak of 119 a few months back.

It finally shuttered down on Wednesday night, leaving its over 16,000 employees in the lurch.

Saddled with debt and losses, the airline is unlikely to come back on its feet any time soon. The airline's total liabilities are said to be about Rs 20,000 crore which includes Rs 8,400 crore owed to banks.

--IANS

nk/sn/mr