Etihad Airways among three to submit financial bid for Jet Airways

Andrew Cummings
May 13, 2019

Two sources involved in the process said Middle Eastern carrier Etihad Airways, which owns a minority stake in Jet, might make a bid before Friday's deadline.

Lenders of Jet Airways led by the state-run State Bank of India (SBI) had mandated SBICaps to initiate the process of selling the airline to recover their dues of over Rs 8,400 crore. The lenders are offering a 31.2 to 75 per cent stake in the company on a fully diluted basis.

Asked for his comment on the bids by some of the unknown individuals and firms, Dhiraj Mathur, Partner, PwC, said: "I won't say that firms reported having submitted their bids for Jet Airways are non-serious or frivolous".

Its plight has been compared to that of India's Kingfisher Airlines, which ceased operations in 2012 before later going bust, causing thousands of job losses and huge financial costs to lenders. "Etihad re-emphasises that it can not be expected to be the sole investor, and that, amongst other requirements, additional suitable investors would need to provide the majority of Jet Airways' required recapitalisation", the spokesman said.

Other shortlisted bidders, including TPG Capital, Indigo Partners and National Infrastructure Investment Fund, did not submit binding bids on Friday.

Jet for several months tried to convince investors, including Etihad, to pump in money and save the airline.

"Besides taking over the office space given to Jet Airways, we are also in the process of encashing their bank guarantee", said an airport director of AAI. But several potential investors had at least one condition - Jet's founder and former chairman Naresh Goyal must cede control.

"The fact that there are interested bidders will lead to some hopes for a resolution, but between now and then there are a lot of ifs and buts", said HDFC Securities analyst Deepak Jasani.

It has also received a few unsolicited offers, which the lenders may deliberate on subsequently, the statement said, adding the banks are likely to evaluate the bids next week.

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