The future of Jet Airways is uncertain since its creditors and new owners cannot agree on a plan to save the Indian airline from bankruptcy. If a crucial court hearing on Tuesday ends without a resolution, creditors may contact India's aviation ministry to request permission to liquidate Jet's assets.
"There are concerns the resolution plan may fall apart so we are looking to see if we can at least get something out of this deal via the liquidation route," the banker, who has direct knowledge of the matter, told Reuters on Monday.
Jet Airways, once the largest private airline in India, stopped operating in April 2019 after running out of money. Creditors who were owed about 180 billion rupees, brought the airline before the bankruptcy court.
Operations to Resume
After the National Company Law Tribunal (NCLT) accepted a reorganisation plan in June, Jet was expected to start operating again in the first quarter of 2022 under its new owners. However, tensions between the new owners, a group that includes tycoon Murari Lal Jala of the UAE and London-based Kalrock Capital, and its lenders run the risk of thwarting Jet's revival.
The resolution plan was accepted by the bankruptcy court and was binding on all parties concerned, a representative for Jet's owners said in a statement on Monday.
"We are "working closely" with the erstwhile lenders of Jet to implement this plan, and remain "fully committed" to getting Jet Airways off the ground," it added.
According to the report, Jet's creditors estimate that it needs about 10 billion rupees in capital to fully fund its operations but has not been able to present that sum.
"So far they have only shown that they have received 1.5 billion rupees worth of bank guarantees and around 200 million of cash which is not adequate to run the operations," the source in the Reuters report added.
However, the report also suggests that a source close to Jet claimed that the company had met all of the requirements of the resolution plan, and the committee of creditors has also checked into the Jalan-Kalrock consortium's capacity to provide capital.