Financially strapped full service airline Jet Airways that Thursday said it received around Rs 258 crore from JetPrivilege, its customer loyalty programme (PTI reported) for advanced ticket sales may have got this relief funding from its strategic partner UAE based Etihad Airways, sources indicate to FE. Earlier in the day a Jet Airways spokesperson was quoted by news agency PTI saying that Jet Privilege concluded a prepaid ticket purchase agreement for USD 35 million with Jet Airways, under normal course of business.

Liquidity starved Jet Airways is currently struggling to keep up its aircraft lease commitments and other trade payables and the succour to the airline comes as a pre-purchase payment by Etihad to its Indian partner for its flying miles programme the JetPrivilege in which Etihad has a majority stake.

Jet has been trying to monetise its flying miles programme and has held certain rounds of discussions with private equity players like TPG. FE had reported that Jet would be seeking to monetise these flying miles for $500 million. Jet management had confirmed that it is looking to raise money against the sale of its JetPrivilege Programme without any specific valuation of the same earlier.

Reportedly the resolution for the same was passed by Jet’s board in an emergency meeting held at Jet’s headquarters on Monday, FE had reported. A late night mail sent to Jet Airways did not get an immediate response. Etihad could not be reached immediately for a comment on the same, but sources indicate that the proposal for a financial restructuring and a plan to support Jet was to be put up for an approval of the Etihad Board.

Etihad bought a 24% stake in Jet Airways for Rs 2,060 crore in May 2013.

Jet Airways is finding it hard to get cash into the airline as the environment for funding aviation businesses is currently not too encouraging for the investors with escalating crude prices and Brent hovering around $90 a barrel and a depreciating rupee coupled with the inability of Indian carriers to raise ticket prices due to a very competitive environment in a low cost carrier dominated market.

In this environment this funding by Etihad will definitely give an interim relief to the airline that has lease payments coming up, as reported by FE this week and it also has commitments towards its aircraft order for the 737MAX-8 .

The airline has also not been able to disburse salaries on time for a large part of its staff as it deferred or partially paid salaries to its different sections of employees since the month of August.

As on June 2018, Jet Airways has a gross debt of Rs 8,620 crore of this Rs 1,968 crore is aircraft debt. The airline has Rs 10,878 crore in accumulated losses and is currently working on a turnaround plan to save Rs 2,000 crore over a couple of years through several initiatives the board has adopted. For the first quarter it got $300 million of liquidity into the airline a large part of which was lease incentives.