After the consortium of 26 bankers led by State Bank of India took Jet Airways to the National Company Law Tribunal (NCLT) to recover their dues, the lenders reportedly picked Ashish Chhawchharia of Grant Thornton India as the resolution professional (RP) for the airline's bankruptcy proceedings, said media reports.
The bankers to the now-grounded airline on Tuesday moved the NCLT to recover their dues of over Rs 8,500 crore. The tribunal will hear the matter on Wednesday.
Chhawchharia is heading the restructuring practice for Grant Thornton in India, according to Moneycontrol. Law firm Cyril Amarchand Mangaldas is the legal advisor to the SBI-led consortium for the Insolvency and Bankruptcy Code (IBC) proceedings, the report said quoting sources.
Chhawchharia is an Insolvency Professional registered with the Insolvency and Bankruptcy Board of India (IBBI), according to a report in Mint.
"Grant Thornton will assist the RP in finding a prospective buyer for Jet Airways and recover the outstanding for the lenders," the report said, quoting a person in the know of the matter.
Jet Airways, started over 25 years ago by airline-ticketing-agent-turned-entrepreneur Naresh Goyal, stopped flying on 17 April this year after it ran out of cash and the unpaid lessors took away most of its 100-odd operational airplanes.
The lenders have been trying to sell the airline as a going concern since the past five months but failed due to many a reason.
Apart from banks, the airline also owes over Rs 10,000 crore to its hundreds of vendors, primarily aircraft lessors and over Rs 3,000 crore to around 23,000 employees who have not been paid since March.
The airline has been having negative net-worth for long and has run a loss of over Rs 13,000 crore in the past few years. Thus it has over Rs 36,500 crore of dues and being a services company negligible assets to recover.
Also, most of its domestic airport slots have been given away to other airlines by the government and so are some of its slots at some key international airports.
On the airplane asset side, Jet Airways had only 16 on its book which are valued around Rs 5,000 crore as per some media reports, as the rest of its 123 fleet were on lease and most of them have been de-registered or taken away by the foreign lessors already.
On Tuesday, Jet Airways' shares faced massive drubbing and tumbled nearly 41 percent after the SBI-led consortium of lenders decided to send the grounded airline to the NCLT.
On Wednesday, the scrip fell 22 percent to trade at Rs 31.40 on the BSE. On the National Stock Exchange (NSE), shares plunged 23 percent to trade at Rs 31.10 apiece.
Last week, the stock exchanges decided to impose restrictions on trading in Jet Airways shares from 28 June as part of preventive surveillance measures to curb excessive volatility. In a circular, NSE said shares of the company would be shifted from "Rolling Segment to Trade for Trade Segment, wherein the settlement in the scrip will take place on gross basis with 100 per cent upfront margin and 5 percent price band".
There are restrictions in trading of shares that are under Trade for Trade Segment.
On Friday, new civil aviation minister Hardeep Singh Puri said that he was confident that problems at grounded Jet Airways would be solved, in the government’s first comments on the debt-laden carrier since it was reelected last month.
“(We are) very confident we can solve the problems at the now defunct carrier,” Puri said on the sidelines of a conference in New Delhi, in comments widely interpreted as referring to Jet Airways.
In a major setback to the lenders' revival plan of Jet Airways, two of its operational creditors — Shaman Wheels and Gaggar Enterprises — on Monday moved the NCLT seeking bankruptcy proceedings against the airline.
Last week, the efforts to revive the cash-starved airline faded after London-based Hinduja Group decided to halt negotiations for buying a stake in now-grounded Jet Airways while Abu Dhabi-based Etihad Airways put its plan on hold to invest further.
--With PTI inputs
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Updated Date: Jun 19, 2019 12:26:28 IST