State Bank of India (SBI)-led consortium of lenders on Tuesday started insolvency proceedings by dragging defaulter Jet Airways (India) Ltd. and its promoters to the National Company Law Tribunal (NCLT)
Jet, 51% owned by Naresh Goyal and 24% by Etihad Airways, owes about ₹8,000 crore to a consortium of lenders.
The airline has a total liabilities, including bank loans, of about ₹25,000 crore.
A petition had been filed in the Mumbai bench of NCLT to recover the dues, lenders confirmed. The petition is expected to come up for hearing on Wednesday.
Reacting to the news, the Jet Airways stock plunged 54% intraday to finally close the day at ₹40.45, down 40.78% on the BSE.
Meanwhile, the two remaining directors on its board, Ashok Chawla and Sharad Sharma, resigned.
In a regulatory filing, Jet Airways said they left “in view of the board continuing to be in non-compliance with the provisions of the Companies Act and no additional directors being apointed and the process of bank-led resolution plan not moving forward.”
Mr. Goyal, who was eased out by the banks in March along with his wife Anita Goyal to facilitate the entry of a new buyer, expressed sadness over the development which landed Jet in NCLT after complete erosion of value.
“I feel sad and deeply distressed mainly for our loyal employees, who have waited for months and hopefully awaiting for a positive outcome to the bank-led resolution plan,” Mr. Goyal said in a statement.
“I can only hope and pray that even now a solution can emerge and Jet can fly and fulfil the needs not only of the employees but for air travellers who feel the absence of the Joy of Flying,” he said.
Etihad’s response
In an e-mailed response to a query by The Hindu , Etihad Airways said it did its best to salvage the airline and would continue the efforts in the rescue plan.
“Etihad Airways has worked consistently to find a solution which would enable Jet Airways to be reactivated as a viable entity. We will continue to constructively evaluate participation in potential solutions,” An Etihad Airways spokesperson said.
Jet Airways employees expressed shock on the development and said it was too late to revive the airline.
“What is left now of Jet?... The NCLT process will take time and all the value will be wiped out. Even if a bidder comes, there will [be] no pilots, engineers and employees left to fly any plane if any,” said Rohit Chaudhaury, senior commander, Jet Airways.
