Earlier in the day, State Bank of India chairman Rajnish Kumar at a press conference to announce the financial results had said he was expecting a serious bid, apart from the two unsolicited ones which had already been submitted, thereby building up a suspense. Kumar didn’t give out Etihad’s name but the conjectures had begun on who the surprise bidder was.
The bid from Etihad, which held 24 per cent in Naresh Goyal-founded Jet Airways, came in the last half an hour before the deadline on Friday. It hinges on multiple conditions, including availability of a majority partner, conversion of debt into equity and lenders agreeing to a substantial haircut to their exposure. In other words, Etihad’s bid is no guarantee that Jet could fly again, analysts pointed out.
“Etihad Airways today confirmed its interest to re-invest in a minority stake in India’s Jet Airways, subject to conditions. India is one of the fastest-growing air transport markets in the world, and a significant economic partner of the UAE. Etihad has been working consistently with key stakeholders in India over the past 15 months to help find a solution which would ensure Jet’s return as a viable and competitive Indian airline, and continues to do so,” the airline said in a statement.
Other shortlisted bidders, including TPG Capital, Indigo Partners and National Infrastructure Investment Fund, did not submit binding bids on Friday.
Many lenders, including SBI and Syndicate Bank, have categorized loans to Jet Airways, which has remained grounded for about a month, as non-performing in the fourth quarter of the financial year 2018-19 and made provisions for it.
The slippages in the case of SBI were to the tune of Rs 1,220 crore for its exposure to Jet Airways.
According to bankers, the indicative pricing by bidder(s) would decide the extent of haircut lenders would have to take as part of the resolution package.