After lenders approved a fresh funds infusion of Rs 1,500 crore in Jet Airways, SBI Chairman Rajnish Kumar said that he hopes the carrier gets back to normalcy, Delhi-Mumbai business fares are not as high as Rs 1 lakh and employees retain their jobs.
After lenders approved a fresh funds infusion of Rs 1,500 crore in Jet Airways, SBI Chairman Rajnish Kumar said that he hopes the airline gets back to normalcy, Delhi-Mumbai business fares are not as high as Rs 1 lakh and the incumbent 23,000 employees do not lose their jobs. “The effort would be to restore normalcy, and then sell Jet Airways as a going concern,” he said in an interview to CNBC TV18.
Outlining the details about the fresh Rs 1,500 crore infusion, Rajnish Kumar said that it is an interim secured funding for a period of 2 months. “This is secured lending and there is no undue risk taken by the lender in the scheme of things. In return for this interim funding, lenders are getting 50.5% worth of shares, whose value at today’s market cap is Rs 1,500 crore. This funding will also have priorities in cash flows over any other lending,” he said in the interview.
Sharing his vision for a period after two months, Kumar said that the best case scenario is that the airline is running at full capacity, jobs of 23,000 employees has been protected, and the lenders sacrifice is not higher than the equityholdres’ sacrifice. “This is my wish, but there is no guarantee,” he added.
In the same address Kumar noted that he is confident of finding a new buyer for the airline by 31st May. “It is unfortunate that because of the differences between the JV partners, the resolution plan could not proceed.
In case there has to be modifications to the plan, that will be through negotiations with the new investor,” he said, after the exit on Naresh Goyal from the board. Further, Rajnish Kumar added that there is no legal bar on anyone, including Mr Naresh Goyal to return to the firm. Anybody can arrange the funding and negotiate terms as the new investor, he said.