The crisis in Jet Airways has deepened, with the lenders unwilling to pump in any interim funds to meet even the operational cost. The company has called an emergency board meeting on Tuesday to discuss the way forward.

According to sources close to lenders, the company does not have any asset to securitise any funding.

A meeting between the Jet Airways management and the lenders on Monday failed to achieve a breakthrough in terms of getting interim funding to pay dues to employees and lessors .

“As you are aware, we have been working with the lenders to secure an interim funding for our operations. The interim funding has not been forthcoming thus far... The current status of our engagement with the lenders and other related matters shall be placed before the board in the meeting scheduled for tomorrow (Tuesday) morning, where the management will seek guidance from the board on the next steps forward,” Jet Airways CEO Vinay Dube said in a statement.

The airline said it has extended cancellation of all international operations to April 19 due to the fund crunch. There are only about seven flights on domestic routes that are operational.

The pilots and staff of Jet Airways, who have been planning a strike to push for pending salaries, have now put off their plans.

“There are only seven aircraft in operation, so even if the employees union go on strike, the company will find a handful of people to manage the company. So, there may not be any impact of striking work,”said a senior executive.

Scouting for new partner

Meanwhile, the lenders are hoping to get a new strategic investor in place to run the airline. But the key question is whether Naresh Goyal’s bid will be accepted or not. Sources close to the lenders indicated that legally there is no bar on Goyal from bidding. “As per rules, a defaulting promoter can be stopped only if the default is for over 12 months. In the case of Jet Airways, the default is only for three months, so Goyal’s expression of interest is valid. However, the lenders can still disqualify him on technical grounds,” said a source.

When contacted, an SBI spokesperson said: “The bid process for orderly sale of equity in Jet Airways is currently being run by SBI CAPS and is being vetted by the legal team. The prospective bidders will be shortlisted by SBI CAPS shortly.”

There are about seven entities that have expressed interest in acquiring stake in Jet Airways. But the entire process may take time till June, which may be too late for the airline.

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