INSUBCONTINENT EXCLUSIVE:
easy.The airline, which was on the brink of bankruptcy, was bailed out on Monday by state-run banks, which have temporarily taken a majority
stake in the company, given it a new loan of $218 million and forced its chairman, Naresh Goyal, to step down from the board of the airline
he founded 25 years ago.Jet shares have rallied 20 per cent since news of the rescue on hopes that the airline would now be able to clear
salaries, redeploy grounded planes and claw back market share.Its future is far from certain though, as a consortium of banks led by State
Bank of India now rushes to find a new investor and sell its stake in the airline.This may not be easy especially with Mr Goyal still
holding a 25.5 per cent share in Jet, which gives him the legal right to block key decisions including raising capital, issuing new shares
and diluting equity.If a deep-pocketed investor is not found soon, Jet may struggle for funds again as the interim loan given by the banks
will not last for very long, say lessors and analysts."Right now Jet is in survival mode, there is no strategy," said an executive at one of
Jet has been in talks with the lessor since securing the deal but it has given few details on settling pending lease payments and on its
turnaround plans, he said."The important thing for us to know is if the airline has somebody who is patient, capable and has the financial
muscle to revive it," he said, adding his company is yet to decide whether to keep the aircraft they grounded tied to Jet.Once country's
The airline's market share has nearly halved to 11.4 per cent from 21.2 per cent in 2016 and it has been forced to ground about two-thirds
of its fleet leading to hundreds of flight cancellations.Domestic conglomerate Tata Sons had been in talks to invest in Jet on the condition
that Mr Goyal would step down, or take a less prominent role, sources told Reuters in November
While the rescue deal could put Tata back in the race, Mr Goyal's trimmed stake may still be a problem."Are you not creating a huge hurdle
for the potential investors" said a senior government official, reacting to the bank-led bailout in which Mr Goyal still has a stake.India
also wants a domestic investor to replace the banks, which rules out potential deep-pocketed suitors like Qatar Airways but the
government-backed National Investment and Infrastructure Fund, whose shareholders also include Abu Dhabi Investment Fund, is still in the
fray, sources have said.State Bank of India Chairman Rajnish Kumar has said Mr Goyal would not pose a problem for any incoming investor but
also said that the former chairman would be allowed to bid for the banks' shares when they are auctioned, leaving a window open for the
founder to come back.The bank was not immediately available for comment.LOST CONFIDENCEIn a fresh sign of its weak financial situation, just
days after the bailout, Jet told the domestic stock exchange on Thursday that it had defaulted on an overseas loan due to "temporary
Local media reported that it was a loan of $140 million.Several Jet pilots, who have not been paid for months, have switched airlines, and
rival carriers like SpiceJet have been in talks with Jet's lessors to take some of its grounded planes on lease, a source has told
Reuters.Jet has assured authorities that no more planes will be grounded and that it is in talks with lessors to have a total of 75 planes
back in the air by end-April from about 35 today."The current funding measures are short term and will not bring much confidence till a new
investor is on board," said Kapil Kaul, India CEO at aviation consulting firm CAPA."Process of returning (Jet's ) fleet back to the system
might not be easy especially since the aircraft can be deployed easily to other airlines or markets," said Mr Kaul.Get the latest election
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