Last Updated: June 23, 2021, 1035hrs
The revival plan for the Jet Airways submitted by a consortium of London-based Kalrock Capital and the UAE-based businessmen Murari Lal Jalan was approved by the National Companies Law Tribunal (NCLT) on Tuesday.
As part of the revival plan, NCLT has given 90 days from June 22 to Director General of Civil Aviation and Aviation Ministry to allot slots to Jet Airways.
The airline which became a scheduled carrier in 1995 suspended operations on April 17, 2019 due to financial distress and has been undergoing a resolution process under the Insolvency and Bankruptcy Code (IBC) for two years. The airline at that time operated a fleet of more than 120 planes serving many domestic and international hubs such as Delhi, Singapore, London and Dubai.
In a recent affidavit submitted to the bankruptcy court, MoCA and the DGCA said Jet Airways cannot claim historicity to obtain the slots and that allocation of slots would be done in accordance with the existing guidelines. Jet Airways had about 700 time slots, allowing it to land and depart from congested airports such as Mumbai and Delhi.
As per the plan the airline initially by the end on this year will operate on 20 routes, with 20 narrow body aircraft and 5 wide-bodied aircraft.
Jet Airways will re-employ those who have remained loyal to the airline and hire more personnel as the airline expands.
Financial creditors led by State Bank of India have claims worth Rs 7,460 crore against the airline. Operational creditors, including workmen and employees, also have claims worth over Rs 7,000. According to a person with direct knowledge of the deal, lenders will be paid up to Rs 1,000 crore over five years through non-convertible debentures. Kalrock Capital will also provide Rs 900-1,000 crore in working capital to the ailing airline. And, the financial creditors are set to get a 10% equity stake in Jet Airways.
The new owners who do not have any aviation experience, will need to spend considerable amount of time to regain the trust of lessors and other creditors. Without this in place, they will struggle to get Jet Airways back to the way it was with Naresh Goyal.