SBI calls lenders’ meeting with Jet Airways, Etihad Airways heads

SBI calls lenders’ meeting with Jet Airways, Etihad Airways heads

AgenciesUpdated: Wednesday, May 29, 2019, 01:52 AM IST
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New Delhi: State Bank of India (SBI) has called an urgent meeting of lenders with Jet Airways Chairman Naresh Goyal and the domestic carrier’s significant shareholder Etihad Airways’ CEO Tony Douglas on Wednesday to discuss a way forward for the debt-laden airline, sources said. The meeting, to be held at SBI’s office in Mumbai, assumes significance amid differences persisting between Goyal, the lenders and Etihad, which has 24 per cent stake in Jet Airways.

SBI is the lead lender of a consortium that has extended loans to Jet Airways. While there was no official word from the airline, as also from the lenders, officials aware about the development said the meeting has been called by SBI and both Goyal and Douglas would be present.

Earlier on Monday, Jet and Etihad said in a joint statement they along with key financial stakeholders are working towards finalisation of bank-led provisional resolution plan for the debt-laden domestic airline. The two carriers have also expressed confidence that once the plan is implemented, Jet Airways would “re-emerge as a viable and robust airline to reclaim its rightful place as airline of first choice for its customers”.

Officials said Goyal is not agreeable to Etihad’s demands that he should pledge his shares in the airline as well as in the loyalty programme, Jet Privilege, with lenders to raise funds. Another bone of contention is that the Gulf carrier wants Goyal to be the sole promoter of Jet Airways but without board representation and management control, sources said.

Lenders had originally proposed a rights issue of shares worth Rs 4,000 crore, in which SBI and other banks could have infused Rs 600 crore and NIIF Rs 1,400 crore for shares of the airlines. However, Etihad wants a rights issue worth Rs 5,000 crore while expecting SBI-led lenders and NIIF to bring an additional Rs 1,000 crore.

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