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No resolution plan yet for Jet Airways; lenders to take a call on March 12

Under the insolvency and bankruptcy code (IBC), the amended maximum time limit for completion of CIRP has been set at 330 days, which includes the litigation period.

Aneesh Phadnis & Subrata Panda  |  Mumbai 

Jet Airways
The total claim amount of the creditors is Rs 36,090 crore, of which Rs 14,640 crore was admitted as on October 20.

Efforts to revive have reached a dead end, as it did not receive any resolution plan from its suitors until the last date of plan submission.

The committee of creditors (CoC) of Jet is set to meet on Thursday to take a call on the future course of action, including liquidating the company.

The resolution professional has not received any proposal or expression of interest from suitors, which would allow him to seek a further extension. Also, the 270 day corporate insolvency resolution process (CIRP) of the company comes to an end in the second week of March.

Under the insolvency and bankruptcy code (IBC), the amended maximum time limit for completion of CIRP has been set at 330 days, which includes the litigation period.

Russia-based Far East Development Fund, New Delhi-based Prudent ARC and South America-based Synergy Group had submitted expression of interest for the airline in the second round of bidding.

The Russian fund expressed interest in airline’s revival last month hoping to introduce Sukhoi Super Jet 100 in the Indian market. Its executives met the top functionaries of the central government but were apparently nudged to consider investing in Air India. Prudent ARC had sought additional time to raise funds from investors but failed to muster a plan while the third suitor Synergy Group turned cold as it had issues regarding airports slots in India and abroad. Besides slots, Synergy had also made some reservations about the past liabilities of Jet.

“The RP will place the facts before the lenders on Thursday and they have to take a call on liquidation or given a further extension,” said a person aware of the development.

Vishesh C Chandidok, chief executive officer, Grant Thornton India, tweeted that the airline had run out of options, as he feared that it was end of read of road for the airline.

This was the second time that lenders called for a fresh resolution as the first round of bidding did not result in any resolution plan. The lenders gave ample time to the prospective suitors by extending the deadline repeatedly.

The total claim amount of the creditors is Rs 36,090 crore, of which Rs 14,640 crore was admitted as on October 20. Jet had shut its operations in April 2019 and was dragged to the insolvency court on June 20, 2019, by its lenders over dues.

Currently, the airline has 12 aircraft, including three Boeing 737s, six Boeing 777s, and three Airbus A330s, (including one leased to Air Serbia).

Jet had 20-30 per cent of available slots at Delhi and Mumbai airports and overseas traffic rights, but these have been allocated temporarily to other carriers. In December 2018, the airline had 115 planes, but most of them have been repossessed by lessors.

First Published: Mon, March 09 2020. 22:18 IST
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