Cash-strapped Jet Airways lenders attempt to sell bankrupt carrier again; to call bids for asset sale by 20 July

Last month, JetAirways' creditors, led by State Bank of India (SBI), took the airline to the bankruptcy court after failing to agree on a revival plan

Reuters July 17, 2019 10:44:47 IST
Cash-strapped Jet Airways lenders attempt to sell bankrupt carrier again; to call bids for asset sale by 20 July
  • Last month, Jet’s creditors, led by State Bank of India (SBI), took the airline to the bankruptcy court after failing to agree on a revival plan

  • The airline, grounded since 17 April, was admitted to the Mumbai bench of the National Company Law Tribunal on 20 June

  • The bankers are also considering a request to provide interim funding of $10 million to pay operational and maintenance costs

New Delhi: Lenders to Jet Airways will open bids to sell the bankrupt airline on 20 July as they look to recover about 85 billion rupees ($1.24 billion) of loans, two sources familiar with the matter said on Tuesday.

Last month, Jet’s creditors, led by State Bank of India (SBI), took the airline to the bankruptcy court after failing to agree on a revival plan.

The airline, grounded since 17 April, was admitted to the Mumbai bench of the National Company Law Tribunal on 20 June.

Cashstrapped Jet Airways lenders attempt to sell bankrupt carrier again to call bids for asset sale by 20 July

Representative image. Reuters

Since then, the court has directed the bankruptcy resolution firm Grant Thornton, which liaises with creditors on behalf of the bankrupt firm, to complete the recovery process within 90 days instead of the 180 days that is typically awarded.

The bankers are also considering a request to provide interim funding of $10 million to pay some employee, legal, compliance, operational and maintenance costs, among other things, said one of the sources, who was present at the first meeting of the core committee of creditors (COCA).

The Expression of Interest window to gauge buyer interest in the airline will open next Saturday and candidates should be shortlisted by early August, according to one of the sources.

An SBI-led consortium of 26 banks has informed the resolution professionals that Jet Airways owes them about 85 billion rupees, added the banker. Apart from this, it also owes over 4 billion rupees to employees in unpaid salaries.

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