Jet Airways is shutting down operations from tonight

Daniel Fowler
April 17, 2019

"The company has reached out to our lead lender, State Bank of India yet again and stressed on the need for urgent funding requirements, critical to the continuation of the operations of our airline", Jet Airways said in a filing to BSE. This comes close on the heels of lenders rejecting a Rs 400 crore emergency funding. Hence the government has decided not to meddle in the carrier's affairs and let the lenders take a call.

"The airline has been left with no other choice today but to go ahead with a temporary suspension of flight operations", the company said in a two-page statement late on Wednesday.

"Jet Airways will now await the bid finalisation process by SBI and the consortium of Indian Lenders", the airline said, adding that it hoped to resume services "as soon as possible".

The airline, which has a huge debt pile on its books, is in the midst of a stake sale process with bids being scrutinised for the final round. According to Kharola, the airline operated with five aircraft on Tuesday. Jet Airways had more than USA $1.2 billion in debt.

The airline, once India's largest private carrier, has been forced in recent weeks to cancel hundreds of flights and to halt all flights to overseas destinations.

In its response to the airline, the lenders have said, "The Expressions of Interest (EOI) have been received and bid documents have been issued to the eligible recipients today".

Jet Airways will stop operations as of the night of April 17.

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Intense competition from low-priced carriers, like Interglobe-owned IndiGo and SpiceJet Ltd, together with higher oil prices, hefty fuel taxes and a weak rupee have piled pressure on the airline in recent months.

"Lenders are committed to a revival plan for Jet Airways", Punjab National Bank's Managing Director Sunil Mehta said.

A high-ranking official working with Jet Airways confirmed the news saying that 'we will be grounded for good from tonight.' "It's a sad news for all of us. Interim funding has not been forthcoming thus far, & as a result of this we have extended cancellation of worldwide operations through Thursday, April 19".

Mehta's comments come after Jet informed all employees in a letter on Monday it was extending a suspension of worldwide flights until Thursday due to a lack of funds.

Jet's pilots along with engineers and senior staff were last paid for December 2018.

Expressing solidarity with Jet Airways founder Naresh Goyal, Mallya said that though Goyal was his competitor, the Jet Airways founder deserves credit for building an airline which made every Indian proud.

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