Business

Investors demand write-offs as Jet owes over Rs 11K crore debt

Mumbai, Apr 22 (IANS) | Publish Date: 4/22/2019 12:33:08 PM IST

Prospective investors in the temporarily grounded Jet Airways have asked lenders to take a massive haircut or write-off around 80 per cent outstanding debt of the airline which is more than Rs 11,000 crore, document and sources revealed on Monday.

According to industry insiders, nine India based banks and two international lenders are expected to suffer major write-off with one of the interested parties asking for over 80 per cent write-off.

The latest figure, which includes the interest accrued on lenders loans, external commercial borrowings and non convertible debentures (NCDs) was revealed after IANS accessed the financial obligations document.

These figures exclude liabilities to vendors and employees.

Accordingly, the airline owes the largest chunk to its lenders at over Rs 7,000 crore (Rs 7,251 crore).

The State Bank of India (SBI), itself, has an exposure of Rs 1,958 crore worth of working capital and term loan on its sheet.

The nine lenders are led by the SBI.

Another public sector lender Punjab National Bank, follows suit with Jet owing an outstanding of Rs 1,746 crore.

Last week, Jet Airways announced temporary suspension of all its flight services as it failed to secure interim funding for maintaining even bare minimum operations.

On its part, Jet in a regulatory had said that the SBI told the airline that consortium of lenders are unable to consider the private carrier’s request for critical interim funding.

“Since no emergency funding from the lenders or any other source is forthcoming, the airline will not be able to pay for fuel or other critical services to keep the operations going,” the filing said.

“Consequently, with immediate effect, Jet Airways is compelled to cancel all its international and domestic flights. The last flight will operate today (April 17).”

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