While Jet Airway’s financial and operational creditors are owned an amount of $4.2 billion in the event of a liquidation scenario where no buyer is found for the bankrupt airline, they will receive just $300-400 million of the amount, according to a Reuters report.
Citing sources with direct knowledge of the matter, the report said that the expected recovery on Jet’s planes and real estate would be $300-400 million after removing the debt tied to those assets.
The report comes after the third deadline for submission of an Expression of Interest (EoI) expired on August 31, with only Russian Fund Treasury RA Partners, Panama-based investment firm Avantulo Group and South American conglomerate Synergy Group Corp having submitted their EoIs.
The report added that Jet’s assets included “four to six Boeing and Airbus aircraft, and some real estate assets in India, on which there are some outstanding dues.”
Meanwhile, Bloomberg Quint reported that the committee of creditors for Jet Airways had shortlisted two potential buyers from the initial list of three who had expressed intent in making the purchase.
Earlier, on September 2, it was reported that South American conglomerate Synergy Group was willing to buy the stake in Jet provided the debt was converted into equity.
In India, Jet had an 11.5 per cent market share in February. Its financial troubles began in early 2018 when it first reported a drop in revenue. Over the year, Jet struggled to pay many of its over 20,000 employees.
The airline first defaulted on its debts in December, 2018, by which point it was closing services and shutting flights.
In March, Jet’s founder Naresh Goyal and his wife Anita stepped down from the company, as Tata and Qatar Airways expressed intent in purchasing the airlines. The next month, Jet Airways stopped flying operations entirely.
In May, SpiceJet inducted 22 aircraft from Jet’s grounded fleet on a sub-lease basis, by which point it had already hired over a hundred of Jet’s pilots.
In June, Jet was taken to insolvency court. There, a 90-day deadline was given to resolution professional Ashish Chhauchharia of Grant Thornton to conclude the resolution process, as “the matter is of national importance”.
