Banks had no authority to consider the relaxation demanded by Etihad Airways, which had submitted a conditional bid for Jet Airways, the State Bank of India informed the exchanges.
Banks decided to refer Jet Airways for bankruptcy proceedings after the resolution process initiated to attract investors failed.
“Subsequent to the closure of the bidding, as no binding bids were received, discussions were held with Etihad and other prospective investors to find a way for infusion of funds,” SBI said. “Etihad had sought certain relaxations viz. waiver of open offer, assurance of flying slots etc. As the lenders did not have any authority to accommodate some of the relaxations sought by Etihad, it was not considered feasible to negotiate on the conditions laid by Etihad,” it added.
SBI said with the financial position of Jet Airways being weak, lenders were continuously trying for a viable resolution for the last one year. Reputed consultants such as SBI Caps and McKinsey were roped in as process advisers. After the closure of the bidding process, since no binding bids were received, discussions were held with Etihad and other prospective investors to find a way for infusion of funds, SBI said.
“Since a sustainable Resolution Plan could not be devised and two operational creditors have already approached NCLT, the member banks agreed in-principle to approach NCLT, pursuant to the statutory right available to them under the lnsolvency & Bankruptcy Code, 2016,” the lender added.
