Bidders for Jet Airways Ltd have not shown interest in following up on their offers for the debt-laden airline with a few days left to submit their final bids, a media report said on Thursday.
A bankers' consortium led by State Bank of India (SBI) had invited bids for selling anywhere between 31 and 75 percent stake in the airline as part of the resolution plan for Jet Airways.
According to The Economic Times, three of the four qualified bidders—Etihad Airways, TPG Capital and Indigo Partners—have not signed non-disclosure agreements which are necessary for conducting due diligence.
The bidders have until 10 May to submit their offers.
The reason that are prompted bidders to pull out of the stake buy process was reportedly the government’s decision to allocate the beleaguered airline's flight slots to rival airlines.
Interestingly, soon after Jet Airways announced it was suspending operations temporarily on 17 April following acute liquidity crunch, each bidder reportedly had internal discussions to assess if there was any value left in the airline for a new investor, said the report.
Etihad, which was keen to buy controlling stake in Jet Airways, has reportedly had a second thought with the investment process as it could not find any value left in the embattled airline, said a Business Standard report.
"Etihad also lacks the financial strength to infuse funds for reviving Jet Airways," said the report quoting a source in the know of the matter.
Jet management has also been trying to tap India’s biggest business houses for investment, the newspaper said.
They have met executives at Mahindra, Adani, Tata group and Reliance Industries in the last two weeks, but none of the conglomerates has responded positively, the ET report said.
Jet Airways, Etihad Airways, TPG Capital, Adani, Tata and Reliance did not immediately respond to Reuters requests for comment, while Indigo Partners and Mahindra group were not immediately reachable for comment.
Shares of Jet Airways Ltd tumbled over 20 percent to a decade low on Thursday. Jet’s stock was trading at 125.90 rupees at 11.06 am.
Jet, once India’s largest private airline, was forced to stop all flight operations on 17 April after its banks rejected the carrier’s plea for emergency funds.
At its peak, Jet operated over 120 planes and well over 600 daily flights. The airline has roughly 16,000 employees.
Jet Airways will soon be asked to vacate the office space occupied by the airline at the terminals of all Airport Authority of India (AAI) airports, CNBC-TV18 said on Wednesday.
AAI, which manages around 125 airports in the country, has reportedly asked all its airports to get the space vacated as soon as possible and submit progress reports on the same by Thursday.
As many as 440 slots are vacant at Delhi and Mumbai airports which will be allocated to other airlines in a transparent manner, a senior official had said last month. The grounding of planes by Jet Airways has resulted in capacity reduction in the domestic sector, which has also led to a spurt in airfares in many sectors.
There are 280 vacant slots at Mumbai and over 160 at the Delhi airport. These two aerodromes are among the busiest in the country.
Once allotted, an airline can keep the slot for one flying season or six months and Jet Airways can reclaim the slots if it is revived by the end of the flying season, the source said.
The current flying season ends on 26 October, according to the Indian aviation regulator’s website.
IndiGo, the country's biggest airline, has been rapidly inducting new Airbus SE A320neos into its fleet in recent months.
In April, low-cost airline SpiceJet pledged to add 27 planes , adding it would launch 24 new flights from Mumbai and Delhi.
“The industry is currently facing severe shortage of capacity and SpiceJet remains committed to make all possible efforts to minimize passenger inconvenience,” said Ajay Singh, SpiceJet’s chairman.
On Wednesday, the Delhi High Court issued a notice to Jet Airways regarding a plea seeking a full refund of the airfare to the passengers who were affected by the suspension of the airline's service.
The bench led by Chief Justice Rajendra Menon and Justice Anup Jairam Bhambhani also sought a reply from Directorate General of Civil Aviation (DGCA) and the Ministry of Civil Aviation in this regard.
The plea was filed by advocate Shashank Deo Sudhi on behalf of petitioner Bejon Kumar Mishra. It sought prompt resolution to all the affected passengers by a full refund of the amount in respect of their booked air ticket or accommodation in other flights.
With agency inputs
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Updated Date: May 02, 2019 12:05:52 IST