Investors demand write-offs as Jet owes over ₹110B debt

mumbai — 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 ₹110 billion, 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 ₹70 billion (₹72.51 billion).

The State Bank of India (SBI), itself, has an exposure of ₹19.58 billion 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 ₹17.46 billion.

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.