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Jet in talks with various investors for sustainable financing: CEO Dube

Tata Sons has confirmed its interest in acquiring the beleaguered airline but has said no concrete proposal has been made by the group so far

Press Trust of India  |  New Delhi 

Jet Airways

is in active discussions with various investors to secure sustainable financing, and cost optimisation efforts have resulted in savings worth Rs 5 billion in the first half of the current financial year, its CEO Vinay Dube has said.

In a communication to Jet Privilege members, Dube also said the airline is deploying aircraft on more profitable, productive and economically-efficient routes.

Grappling with financial woes, the full-service carrier is looking for investors to tide over the liquidity crisis, which has resulted in delayed payments to some vendors and salaries to a section of its over 16,000 employees.

"We are in active discussions with various investors to secure sustainable financing to navigate through the current headwinds and create long-term growth. There is interest in our strong brand and confidence in our business turnaround efforts," Dube said.

On November 16, Tata Sons confirmed its interest in acquiring the beleaguered but said no concrete "proposal" has been made by the group so far.

Last week, the airline posted a net loss of Rs 12.61 billion for the three months ended September.

ALSO READ: Plan to buy beleaguered Jet Airways flies into rough winds with Tata bosses

Despite a tough operating environment, Dube said the airline's ancillary revenue grew 10 per cent and cargo revenues rose by over 13.7 per cent in the September quarter compared to the year-ago period.

"Even as the domestic market RASK (Revenue per Average Seat Kilometre) showed a decrease, we managed to sustain our RASK due to our strong presence in the international market as well as our loyal corporate customer base," he noted.

According to him, efforts to reduce costs have yielded "over Rs 500 crore (Rs 5 billion) of savings in the first half of 2018-19".

The airline is to take delivery of six more new Boeing 737 MAX aircraft this financial year.

"The nil findings in the last IATA Operational Safety Audit, as well as our DGCA audit clearance over the last couple of months, testify to our commitment to safety, which we have always asserted will be sacrosanct for Jet Airways," Dube said in the communication dated November 19.

ALSO READ: Jet may seek debt recast if it fails to get equity infusion and sell assets

The IATA is a global grouping of airlines while the DGCA is domestic civil aviation regulator.

Jet Privilege, the airline's customer loyalty programme, is majority owned by Etihad Airways, which also has 24 per cent stake in the carrier.

ALSO READ: Tata Sons may seek a strict non-compete agreement with Jet Airways

On November 19, the government virtually ruled out the possibility of a bailout package for the cash-strapped Jet Airways, with Civil Aviation Minister Suresh Prabhu saying that a private airline's management has to make sure that the carrier functions properly.

First Published: Tue, November 20 2018. 19:10 IST