New Delhi: The prospects of Jet Airways’ revival plan look bleak as Etihad Airways has informed State Bank of India (SBI), Jet’s top lender, that it will not make any further investment in the cash-strapped carrier. The Gulf airline will also skip the fundraising deal drawn up by the consortium of lenders, sources say. Etihad, which owns nearly a quarter of Jet, might even sell its stake in the beleaguered carrier.
Etihad CEO Tony Douglas conveyed the decision to SBI chief Rajnish Kumar in a meeting earlier this week. The Gulf carrier’s spokesperson said: “As a minority shareholder, Etihad is working closely with Indian lenders, the company and key stakeholders to facilitate a solution for Jet Airways.”
Meanwhile, Naresh Goyal Jet Airways chairman and his son Nivaan Goyal traveled to Doha to provide a presentation to Qatar Airways global CEO Akbar Al Baker, another source said.
“As a minority shareholder, Etihad is working closely with Indian lenders, the company and key stakeholders to facilitate a solution for Jet Airways”
Some days back, the lenders of Jet informed Etihad that it could exit if did not accept the terms to conditions in the resolution plan. Etihad did not agree to an infusion of Rs 750 crore in Jet.
Jet’s woes continue
Jet has been dealing with facing the worst financial crisis in its 25-year-old existence. The carrier has grounded most of its planes, defaulted on loan repayments, delayed salaries and delayed payments to most vendors including aircraft leasing companies.
What losing Etihad would mean to Jet
It might mean another round of discussions since the cash-strapped carrier would need to hunt for a new partner. Lenders on their own may not be able to revive Jet in the absence of a strategic investor.