 "Jet Airways")
With the lenders deciding to refer Jet Airways to the National Company Law Tribunal (NCLT) after the airline failed to find any buyer, what does it offer in terms of saleable assets in the case of liquidation?
Banks have lent Jet around Rs 8,500 crore and the liabilities, including payments to vendors, are more than Rs 25,000 crore.
Based on an assessment, its most valuable assets are its planes. According to sources, it has 16 Boeings, which include 10 Boeing 777, and a previous valuation by banks says they are worth more than Rs 5,000 crore. Jet had acquired the 10 Boeing 777s in 2006-07 with loans from domestic and foreign banks. The US Exim Bank guaranteed the loans.
However, the airline defaulted on payments of around $35 million and the lenders earlier were in talks to take possession of the planes.
However, firms like cargo handler World Wide Flight Services have moved court in the Netherlands for seizing the 777 aircraft in Amsterdam. And some of the lenders like ING Singapore have approached the Directorate General of Civil Aviation and filed for de-registering these aircraft. It would be a challenge for the resolution professional to untangle this mess.
Secondly, Jet Airways has a 49.9 per cent stake in royalty programme company Jet Privilege Pvt Ltd (Etihad owns the rest), which has more than 9 million members. At its peak when it was negotiating with Blackstone, the valuation of the company was at $900 million. But its value has eroded substantially after Jet closed operations because the flying points were linked closely with members flying Jet.
Third is its brand value, even though it has never been assessed publicly. But that will be relevant only if Jet gets an offer from an investor which would like to buy and run the airline once again. At that looks highly unlikely.
Fourthly, while the details are not available, Jet does have real estate assets, which include the swanky training centre in Mumbai with state-of-the-art simulators and modern instrumentation.
Banks have lent Jet around Rs 8,500 crore and the liabilities, including payments to vendors, are more than Rs 25,000 crore.
Based on an assessment, its most valuable assets are its planes. According to sources, it has 16 Boeings, which include 10 Boeing 777, and a previous valuation by banks says they are worth more than Rs 5,000 crore. Jet had acquired the 10 Boeing 777s in 2006-07 with loans from domestic and foreign banks. The US Exim Bank guaranteed the loans.
However, the airline defaulted on payments of around $35 million and the lenders earlier were in talks to take possession of the planes.
However, firms like cargo handler World Wide Flight Services have moved court in the Netherlands for seizing the 777 aircraft in Amsterdam. And some of the lenders like ING Singapore have approached the Directorate General of Civil Aviation and filed for de-registering these aircraft. It would be a challenge for the resolution professional to untangle this mess.
Secondly, Jet Airways has a 49.9 per cent stake in royalty programme company Jet Privilege Pvt Ltd (Etihad owns the rest), which has more than 9 million members. At its peak when it was negotiating with Blackstone, the valuation of the company was at $900 million. But its value has eroded substantially after Jet closed operations because the flying points were linked closely with members flying Jet.
Third is its brand value, even though it has never been assessed publicly. But that will be relevant only if Jet gets an offer from an investor which would like to buy and run the airline once again. At that looks highly unlikely.
Fourthly, while the details are not available, Jet does have real estate assets, which include the swanky training centre in Mumbai with state-of-the-art simulators and modern instrumentation.
