An official announcement of grounding of operations is expected anytime now as the Jet Airways board had Tuesday authorised chief executive Vinay Dube to make one last appeal to the SBI-led consortium.
Jet Airways aircrafts are seen parked at the Indira Gandhi International Airport in New Delhi. (Photo Credit: Reuters)
The airline, saddled with roughly Rs 8,000 crore of bank debt, has been teetering for weeks after failing to receive a stop-gap loan of about Rs 1,500 crore from its lenders, as part of a rescue deal agreed in late March.
Jet and its lead lender State Bank of India (SBI) did not immediately respond to requests for comment.
The once leading airline has been defaulting on payments, forcing its lessors to retake almost all its planes and it was operating just about six planes as of Tuesday.
An official announcement of grounding of operations is expected anytime now as the Jet Airways board had Tuesday authorised chief executive Vinay Dube to make one last appeal to the SBI-led consortium to get a life-line of Rs 400 crore Wednesday, before taking a final call on the future.
Jet will be the seventh airline to go down since May 2014 and the 13th one after East West was shuttered. During the past five years airlines like Air Pegasus, Air Costa, Air Carnival, Air Deccan, Air Odisha and Zoom Air have all gone belly up even as the government boasts of double-digits growth for more than four years in tow.
“The Jet Airways management’s request for Rs 400 crore emergency funds has been rejected,” banking sources told News18. A source at the Jet Airways also said the airline was likely to shutter soon as the banks have not extended it the required financial support.
“The airline has failed to garner the funds it was desperately looking for to continue operations,” he said. The airline is currently operating only five planes from 123 aircraft in the fleet till last December.
According to sources, the government is maintaining distance from the Jet affairs citing the matter is a commercial decision of banks.