Fresh Hopes of Survival for Jet Airways as Hinduja-Etihad Look Set to Join the List of Bidders
The report also added that the Tata Group and Qatar Airways are also exploring the possibility of a potential bid, but hasn’t taken a final decision yet.
Revival hopes for Jet Airways (India) Ltd took flight once again as Moneycontrol reported late on Friday that a consortium of Hinduja Group and Etihad Airways is likely to re-enter the race to acquire stake in the bankrupt airline. The process will take place through the National Company Law Tribunal (NCLT).
Hinduja Group and Etihad Airways are set to bid together for Jet Airways under the Insolvency and Bankruptcy Code (IBC), four independent sources with knowledge of the matter told Moneycontrol.
The report added that the Tata Group is also exploring the possibility of a potential bid, but hasn’t taken a final decision yet. Qatar Airways is also in exploratory mode and may join the fray if it finds a suitable domestic partner, the sources said.
Earlier in the day, Jet Airways employees and London-based investor Adi Partners LLP said they will jointly bid for a 75% stake in the debt-laden airline. AdiGro Aviation founder Sanjay Viswanathan said his firm will take 49% and the rest will be with the employees’ consortium since there is a 49% cap on foreign direct investment (FDI) in the aviation sector.
Bidders are usually keen on stressed assets under the IBC as it has several advantages as compared to a stake-purchase situation outside the code. “An IBC process offers several advantages to a bidder. First, you do not need to individually negotiate with each stakeholder as an approved resolution plan is binding on all stakeholders. Second, you can whitewash all unknown past liabilities through the plan. Third, you can restructure the existing equity faster. Finally, de-listing a company under IBC is a much easier process,” said Sudip Mahapatra, Partner at law firm S&R Associates.
After failing to find any buyer for the airline, SBI on 18 June filed an insolvency petition against Jet Airways in NCLT under Section 7 of IBC. NCLT admitted the plea on 20 June and suggested a timeline of 90 days for the resolution of the case. It also directed Jet Airways’ Insolvency Resolution Professional (IRP), Ashish Chhawchharia, to submit fortnightly progress reports on the case, with the first such report to be submitted before 5 July.
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