Jet may get more than ₹3,000 crore

NEWDELHI: Loss-making Jet Airways is likely to receive fund infusion worth over ₹3,000 crore post debt-rejig and investments by Etihad Airways as well as National Investment and Infrastructure Fund (NIIF), while founder Naresh Goyal might remain the promoter with less than half of the existing majority stake of 51%, according to people familiar with the matter.

While the final contours of debt-restructuring and consequent changes are being worked out, an analyst said that Etihad Airways should come as the main driver for Jet Airways as lenders and shareholders would not be able to bring in much value addition.

Abu Dhabi-based Etihad, which currently owns 24% in the full service carrier, is a strategic partner and is expected to pump in around ₹1,400 crore, people familiar with the matter said. On February 14, Jet Airways’ board approved a BankLed Provisional Resolution Plan (BLPRP), whereby l enders would become the largest shareholders in the airline.

After receiving approval from shareholders, during their meeting scheduled for February 21, part of debt would be converted into 11.4 crore shares at a consideration of ₹1 apiece as per Reserve Bank of India (RBI) norms. Later, appropriate i nterim credit f acilit i es by domestic lenders would be sanc- tioned to the airline, as per a regulatory filing made on February 14.

The government-backed NIIF, where Abu Dhabi Investment Authority is a key stakeholder, is likely to acquire little over 19% stake in the ailing airline, they added. They said that NIIF is likely to put in ₹1,400 crore while lenders, led by the State Bank of India (SBI), are expected to convert debt into equity worth around ₹600 crore. People familiar with the matter also said that Etihad’s proposed investments would hike its stake only marginally and that would not trigger the requirement for making an open offer for shareholders of Jet Airways under Sebi regulations.

Together, the fresh funding for the airline would amount to about ₹3,400 crore and Goyal’s stake could reduce to 20 %from 51% at present, people familiar with the matter said.

Queries sent to Etihad Airways and NIIF on their proposed investments in Jet Airways remained unanswered. Query sent to Jet Airways about Goyal’s stake coming down to around 20% after debt-rejig did not elicit any i mmediat e response.

Deepak Jasani, head of retail research at HDFC Securities, said Etihad should come as the main driver of the company and they have to nominate their main people to run the airline because lenders and shareholders are not going to bring in much value addition.