Naresh Goyal who was forced to quit the Jet Airways as a Chairman in March which he founded 20 years ago along with his wife Neeru Goyal has decided to invest personal funds into the company. It is in debt of more than $1 billion after it defaulted on payments to banks and lessors, not paid salaries to its employees and after failing to secure funds to keep the aircraft operational had to suspend all its flights on April 17.
Goyal made a lot of attempts to raise funds and the latest is that he is ready to invest $250 crore from his personal fund to revive the carrier. Earlier, the founder of the Jet Airways who tried to bid for control was rejected by the banks as they raised some non-eligibility conditions for the bidding process.
The banks have started the bidding process for Jet Airways, as per the eligibility norms, only those who have a net worth of a minimum of Rs 1000 crore or a minimum of three years of experience in aviation can look to invest in the company. Also, the eligibility norm for a financial investor is that the company should have Rs 1000 crore in funds for investment in Indian companies or should be managing assets Rs 2000 crore. The bidding submission can be made till Friday, and a new investor will be decided in June quarter. Many firms like the Etihad Airways, TPG Capital, Indigo Partners are among the shortlisted.
The Jet Airways which was the largest private airline in India was grounded in April, and the government had to allow slots of Jet flights to other players to address flight shortage in domestic air travel. The Goyal’s in an attempt to resume the operations have considered investing in Jet Airways and also provide loan collateral. Addressing a letter to the employees, he said:
“Since stepping down from our respective positions, Neeta (Goyal) and I have had no role at Jet Airways after having made every possible sacrifice and commitment to ensure that the best interests of our Jet Airways family are served.”
The SBI Capitals Market which is handling the bidding has recently received a letter from some minority stakeholders requesting to propose revival. It said that
“Jet Airways’ lenders should not entertain any proposal or bid from any party that sought haircut from banks on the debt obligations of the airline, as that would result in a loss for the banks.”