Resolution plan involves infusion of funds, monetisation of assets and restructuring of the airline’s debt Jet Airways has called a shareholders’ meet on Feb. 21 to seek nod for conversion of debt into 114 million shares After conversion, Etihad Airways

Inflation based on wholesale prices fell to a 10-month low of 2.76 per cent in Jan on softening prices of fuel and some food items. WPI-based inflation stood at 3.8 per cent in Dec, 2018, 3.02 per cent in Jan 2018 and 2.74 per cent in Mar 2018. Inflation in kitchen essentials like potato, onion, fruits, and milk softened in January over the previous month, the data revealed. However, the rate of price rise in the food basket, as a whole, rose to 2.34 per cent in the month compared to a deflation (-0.07 per cent) in the previous month. Mills cannot sell sugar below Rs 31 per kg,a move that will boost the liquidity of cashstrapped millers and help clear mounting cane arrears of around Rs 20,000 crore. The Centre has hiked the minimum selling price (MSP) of sugar by Rs 2 per kg to Rs 31, food minister Ram Vilas Paswan said. “We have increased the MSP from Rs 29 per kg to Rs 31 per kg. This will help millers to make the payment to sugarcane growers,” Paswan said. New Delhi, Feb. 14: The government has raised Rs 10,000 crore by additional offering of Bharat-22 Exchange Traded Fund (ETF).

The additional ‘on-tap’ offering of Bharat-22 ETF was opened for a single day with a base issue size of Rs 3,500 crore and an option to retain over-subscription.

“The Bharat-22 ETF issue received overwhelming response from all categories of investors including retail investors. The Government has decided to retain approximately Rs 10,000 crore as its divestment proceeds,” the finance ministry said.

The proceeds from the ETF sale would help the government move towards meeting the Rs 80,000 crore disinvestment target set for the current fiscal.

With the successful Bharat-22 ETF offering, the government has mopped up approximately Rs 46,000 crore by way of disinvestment.

The government has so far raised Rs 22,900 crore through the Bharat-22 ETF. While Rs 14,500 crore was raised in November 2017, another Rs 8,400 crore was raised in June 2018.

The central public sector enterprises (CPSEs) that are part of the ETF include ONGC, IOC, SBI, BPCL, Coal India and Nalco.

Other constituents include Bharat Electronics, Engineers India, NBCC, NTPC, NHPC, SJVNL, GAIL, PGCIL and NLC India. Only three public sector banks -- SBI, Indian Bank and Bank of Baroda -- figure in the Bharat-22 Index.

Also, the government’s strategic holding in Axis Bank, ITC and L&T, held through Specified Undertaking of Unit Trust of India (SUUTI), has been put in the ETF basket.

This would be the second ETF offering by the government in the current fiscal which ends in March. In November last year, the government had raised Rs 17,300 crore through a follow-on offer of another exchange traded fund -- CPSE ETF, which comprises shares of 11 public sector enterprises. This was the biggestever fund raising from an ETF domestically. The board of Jet Airways on Thursday approved a plan by its lenders led by the State Bank of India (SBI) to resolve a `8,500crore funding gap, making the lenders the largest shareholders in the troubled airline.

The resolution plan involves infusion of funds, monetisation of assets and restructuring of debt.

Jet has called a shareholders’ meeting on February 21 to seek approval for conversion of its debt into 114 million shares.

Following the conversion, it is estimated that the stake-holding of Etihad Airways and Jet Founder and Chairman Naresh Goyal will come down by half to 12 per cent and 25 per cent, respectively.

Under the plan lenders can appoint nominees to the board of India's biggest full-service carrier.

According to a statement issued by the airline, after its approval the plan will be presented back to the lenders, as well as to an overseeing committee of the Indian Bankers' Association, the board of shareholder Etihad Airways and Goyal.

"The BLPRP (Bank Led Provisional Resolution Plan) currently estimates a funding gap of Rs 8,500 crore (including proposed repayment of aircraft debt of `1,700 crore) to be met by appropriate mix of equity infusion, debt restructuring, sale/sale and lease back/ refinancing of aircraft, among other things," the company statement said.

The airline had run into trouble due to high fuel prices, falling rupee and intensified competition in the airline market.

In 2013, Abu Dhabi's Etihad worked out a bailout deal by picking up a 24 per cent stake for $600 million, along with three take-off and landing slots in London Heathrow and a majority share in Jet Airways’ frequent flyer programme.

On Thursday, Jet Airways also reported its fourth consecutive quarterly loss. The airline made a net loss of `588 crore for the December quarter compared with a profit of `165 crore a year earlier.

Revenue from operations stood at `6,148 crore in the December quarter against `6,086 crore posted in the same period last year.

Total expenses in the third quarter shot up to `6,786.15 crore compared to `6,042.58 crore a year ago.

Aircraft fuel expenses stood at `2,387.72 crore compared to `1,840.08 crore in the same quarter last year, while aircraft and engines lease rentals were at `730.35 crore against `583.67 crore.

Shares of Jet airways have fallen 68 per cent in the past year, making it the worst performing airline stock.

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