Etihad Airways is learnt to have abstained from voting on several resolutions to convert Jet Airways’ debt into equity in the EGM the Naresh Goyal-led airline held last Thursday. Etihad has laid down stiff conditions for backing the resolution, a move that could delay the deal to bail out Jet. A delay in resolution will further squeeze Jet Airways, which is negotiating interim funding from banks.
The lenders’ consortium is considering a Rs 500-crore loan, but a final decision is yet to be taken, Punjab National Bank Managing Director Sunil Mehta had said on Friday.
However, the lenders may seek additional securities, including share pledges or guarantees from promoters, while sanctioning loans and are not planning to move the NCLT. A PTI report on Sunday, however, said lead lender SBI might consider taking Jet to the NCLT if the proposed resolution deal turned unfeasible.
On February 21, the airline’s shareholders approved five enabling resolutions to convert its debt into equity, appoint lenders’ nominees on the board, and increase the authorised share capital of the company.
The resolutions were passed by 97-99 per cent of the shareholders, but Etihad, which owns 24 per cent in the airline, abstained from voting, sources said.
The Gulf carrier has been pitching for SBI and the NIIF to own 51 per cent and invest Rs 2,200 crore in the airline, said sources.
Etihad has sought the right of first refusal (RoFR) after one year and wants SBI to get a confirmation from the Securities and Exchange Board of India (Sebi) that the right, if exercised, will not trigger a mandatory open offer, said sources in the know.
Etihad will invest in Jet under a bank-led resolution plan that seeks to bridge a Rs 8,500 crore gap. However, SBI, the lead bank in the consortium, is said to have disapproved the demand for the right of first refusal.
“Etihad’s board is yet to approve the resolution plan and perhaps that is why they abstained from voting,” said an airline source.
Emailed questionnaires to Jet Airways and Etihad on these issues did not elicit any response.
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However, lender sources said they would be meeting shortly — for converting part debt into equity and other elements of the resolution plan.