Exactly 18 months after Jet Airways was first grounded, the airline has found a new owner today. A consortium of investors of Kalrock Capital and Murari Lal Jalan has officially taken over the airline. The revival comes after months of uncertainty and questions if Jet Airways will ever take to the skies again.
Resolution process complete
Jet Airways ran out of funds on 17th April 2019 and subsequently declared bankruptcy. Despite partial ownership by the Etihad group, no buyer came forward at the time to give the airline a second chance. This led to the airline going to the National Company Law Tribunal (NCLT), where creditors appointed a Resolution Professional (RP) to find a new buyer.
In a statement to Moneycontrol, a Kalrock Board member said,
“I want to thank the CoC and the RP for managing the insolvency process. We look forward to engaging with the Jet Airways stakeholders, and bringing back the glory and legacy of the airline.”
What is the plan for Jet’s future?
Now that Kalrock-Jalan has won the bid, they have the unenviable job of reviving an airline during a global pandemic. According to The Economic Times, the consortium has plans to invest $136 million (₹1000 crore) in the airline in the next five years. This investment will likely go toward servicing aircraft and restarting flights.
The path forward will be tricky for Jet Airways. It remains unclear whether Jet will get back its previous slots at key domestic and international airports. If it does, however, the airline could have a much easier time starting domestic flights for the time being.
What will new investors get?
With the sale formalities almost complete (the bid must be accepted by the NCLT), we can now see what assets the new investors will receive. The airline currently owns a fleet of 12 aircraft, including six 777s, three A330s, and three 737s. After some heavy maintenance, these planes could be made airworthy relatively soon.
Aside from its fleet, the airline has little more in the way of assets, with most others being sold in the bankruptcy process. However, the airline still has strong brand value, in India and globally, giving it a leg up when it restarts flights. We will be sure to keep you updated on all developments in this deal and when Jet Airways restarts flights!
What do you think about the Jet Airways sale? Will you fly with the airline again? Let us know in the comments!