Crash landing: Jet Airways cancels all international flights

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Updated: Apr 12, 2019 7:32 AM

JV partner Etihad has reportedly put in a bid for increasing its stake from 24% to 49%.

The development comes in the midst of the airline grounding more than three-fourth of its 119-aircraft fleet.

Cash-strapped Jet Airways has cancelled all international flights which were scheduled Thursday midnight onwards, sources in the airline said.

The development comes in the midst of the airline grounding more than three-fourth of its 119-aircraft fleet.

In what is a clear sign of the crisis deepening even as the lenders wait for April 12 for bids to come to take over the carrier, Jet on Thursday said 10 more aircraft have been grounded due to non-payment of lease rentals, taking the total number of such planes to 81.

Earlier in the day, civil aviation secretary Pradeep Singh Kharola told news agency PTI that the ministry may review Jet’s eligibility to continue its international operations after it gets a report from the regulator DGCA on the issue. “We have sought for all the details from Jet. The DGCA has asked for the details. After we get those details, we will see to it,” Kharola told PTI earlier in the day when asked whether the ministry is planning to review Jet’s eligibility to continue its international operations in view of the almost negligible fleet.

Read | Jet Airways suspends Singapore flights; airline’s fleet now down to 14 aircraft

The government rules stipulate an airline must have at least 20 planes for operating international operations.

Of the 14 aircraft that Jet is operating as of Thursday, 8 are wide-body B777s (seven) and an A330 — generally used for long-haul international operations.

The remaining 6 planes are three B737s, which are largely used for flying on domestic routes besides on short-haul international routes and the rest three are regional ATRs.

Meanwhile, the airline said it is making all efforts to minimise disruption to its network. “The company continues to provide required and periodic updates to the Directorate General of Civil Aviation in this regard,” it said in a statement.

On Thursday, the airline also indefinitely suspended operations to the Eastern and North-Eastern states after its active fleet came down to just 14, a travel industry source said.

“All Jet Airways operations in the Eastern region are suspended, and effective Thursday, there are no Jet flights to and from Kolkata, Patna, Guwahati and other airports in the region,” the travel industry source said.

Jet Airways told PTI that its Mumbai-Kolkata, Kolkata-Guwahati and Dehradun-Guwahati via Kolkata were cancelled for Friday due to “operational reasons”.

Meanwhile, it is understood that the UAE-based Etihad Airways, which has a 24% stake in Jet, has put in bids to increase its share to 49% in the airline under the bank-led resolution plan.

Read | Mission Impossible: How Modi government met fiscal deficit target against odds

Etihad had earlier also shown interest in raising its stake in the airline, provided Goyal steps down and it is exempted from an open offer. While Goyal has stepped down, it is not known whether market regulator Securities and Exchange Board of India (Sebi) has agreed to exempt the company from an open offer if its stake crosses 25%.

It is expected that founder-chairman Naresh Goyal and state-backed National Investment and Infrastructure Fund (NIIF) may also put in bids, the last date for which is April 12.

Replying to an email response on putting in the bids, an Etihad spokesperson said the airline does not comment on rumour or speculation.

Lenders of Jet are offering equity stake between 31.2% and 75% along with control and management of the airline to save it from bankruptcy, according to the EoI released on April 8.

Meanwhile, Goyal on Thursday pledged his 26% stake in the airline as security for loans from Punjab National Bank.

According to a regulatory filing, Goyal pledged 2.95 crore shares or 26.01% share with state-owned PNB on April 4 as security for existing/ new borrowings taken by Jet Airways (India) Ltd.

On the same day, he released 5.79 crore shares held by him that were kept under non disposal undertaking as security for borrowings taken by the airline.

Shares of the airline on Thursday closed at Rs 260.40, down 1.1% on the BSE. The news of cancelling international flights came after trading hours.

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