Jet Airways share dived as much as 13% on Tuesday after a media report said that lenders led by State Bank of India (SBI) are preparing to begin a fresh search for a majority investor in the airline as Etihad Airways stopped short of offering any comprehensive resolution plan.
In bids closed last week, Etihad Airways offered to infuse enough equity so as to maintain its 24% stake in Jet Airways. This means that the lenders still need to find a majority equity buyer who will infuse the bulk of the equity needed for Jet Airways to fly again.
According to the report, lenders took the call to initiate another search process at a meeting on Monday. Meanwhile, Jet Airways said on Tuesday its deputy chief executive and chief financial officer Amit Agarwal has resigned. "We wish to inform that Amit Agarwal, the deputy chief executive officer and CFO of the company, has resigned from service due to personal reasons, with effect from May 13," Jet Airways said in a regulatory filing.
Jet Airways did not mention Agarwal’s replacement. The airline earlier this month accepted the resignation of its whole-time director Gaurang Shetty.
At 12:09pm, shares of Jet Airways were trading at Rs 126.45, down 9%, on BSE.
Jet Airways had temporarily suspended its flight operations on 17 April due to liquidity crisis. The airline has a debt of over Rs 10,000 crore. SBI and Punjab National bank with nearly Rs 2,000 crore each are the two main lenders involved in the process.
The lenders had initiated a bidding process to sell stake in the airline to recover some of the debt. The banks are offering up to 75% stake in Jet Airways on a fully diluted basis. The proceeds of the stake sale are expected to help realize at least a portion of the debt the airline owes to its lenders.