Eti­had in res­cue talks with bankers for Jet Air­ways

Gulf Times Business - - BUSINESS -

Jet Air­ways and sec­ond-largest share­holder Eti­had Air­ways have been hold­ing res­cue talks with bankers of the in­debted In­dian car­rier, three peo­ple aware of the mat­ter told Reuters yes­ter­day.

Ex­ec­u­tives of the air­lines met State Bank of In­dia of­fi­cials in re­cent days to dis­cuss Jet’s cash flow and busi­ness plan, two of the peo­ple said.

One said Jet has out­stand­ing dues of about $400mn, mainly owed to lessors and ven­dors.

Eti­had is also con­sid­er­ing rais­ing its stake above the 24% it has held since 2013, said one of the peo­ple, who de­clined to be iden­ti­fied as the talks were pri­vate. For­eign­ers can own up to 49% of an In­dian car­rier.

The news sent Jet’s stock up as much as 3% in early trade be­fore clos­ing down 5.5%. Jet and State Bank of In­dia did not re­spond to re­quests for com­ment.

Jet, con­trolled by founder Naresh Goyal, is In­dia’s big­gest full-ser­vice car­rier by mar­ket share, serv­ing one of the world’s fastest-grow­ing do­mes­tic avi­a­tion mar­kets. Yet the mar­ket is dom­i­nated by low-cost car­ri­ers such as In­ter­globe Avi­a­tion’s IndiGo, and is blighted by high fuel prices, a weak ru­pee and price com­pe­ti­tion.

More cash from Eti­had is not guar­an­teed con­sid­er­ing its own fi­nan­cial state, one of the peo­ple said. The air­line re­ported a $1.52bn an­nual loss for 2017 due in part to in­sol­vency part­ner­ships Al­i­talia and Air Berlin. How­ever, there is also the fear that Jet will strug­gle to sur­vive with­out fur­ther in­vest­ment, the per­son said.

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