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Lenders take big risk in converting part of Jet Airways' debt into equity

Banks did not make money in previous debt-to-equity conversions

Jet Airways

Indian lenders are taking a significant risk in converting part of Jet Airways’ debt into equity because in about 20 similar cases before banks had been unsuccessful in making money. Many power projects where the debt was converted into equity are awaiting a sale.   Among the recent big accounts where the lenders converted debt into equity include Jaypee Power Ventures, IVRCL, KSK Mahanadi, Lanco and Kingfisher Airlines.   “While Kingfisher’s debt was converted into equity at a premium to the then market price of the airline, in the case of Jet the debt is ...