Jet Air: Synergy Group sets riders for investment

South American conglomerate Synergy Group has informed the Mumbai Bench of National Company Law Tribunal (NCLT) that it is interested in investing in Jet Airways, subject to certain conditions.

The investment would be in exchange for a stake in the defunct carrier.

The tribunal also asked the lenders to expedite the EoI process, even as it posted the case to January 8 for next hearing.

Synergy Group intends to “float a new company that is free of all legacy liabilities of the erstwhile Jet Airways”, Synergy Group’s Executive Vice-President, Michael Welch, informed the tribunal on Thursday.

Welch, who was clarifying Synergy Group’s interest in the airline, also told the Bench that the group was in the process of formulating a plan to takeover the carrier. “It is a great opportunity, however, critical criterion pertaining to the airline need to be met and resolved,” he said.

Slots availability

Synergy wants issues such as availability of slots in India and Heathrow airport in London among others to be resolved, following which all assets, slots, aircraft and employees would be transferred to a new company, said Welch.

According to an industry expert, who did not want to be identified, this may mean that Synergy Group is free of legal liabilities pertaining to Serious Fraud Investigation Office (SFIO) or the Enforcement Directorate.

“It’s obvious that the banks will have to write-off some debt, a consensus on that needs to arrived upon,” he added.

Mark D Martin, founder and CEO of Martin Consulting, said: “Why would anyone take on bad debt or past liabilities, which is the least Synergy can ask for?”

During the proceeding, the two-member Bench comprising Bhaskara Pantula Mohan and Rajesh Sharma said that formation of a new company was only possible after a formal takeover.

The Bench also said that the government had assured NCLT that the allotment of slots won’t be an issue, even though it cannot be guaranteed.

Unpaid dues

Jet’s lead lender State Bank of India had dragged the company to the tribunal on June 20 over unpaid dues. On December 19, the tribunal asked Welch that since the insolvency process was on for five months, Synergy Group needs to “expedite the process” and make the earnest money deposit.

“We understand the urgency of the matter. However, we will require a little bit more time to arrive at the conclusion that this is the right decision on behalf of the stakeholders,” Welch said before the NCLT.

The Resolution Professional informed the court that Welch was set to meet Jet Airways’ debtors on Thursday.