Jet Airways announced that it has temporarily suspended all flight operations from Wednesday night as the airline failed to secure an interim funding for maintaining even bare minimum operations. The company’s decision came after the airline failed to secure an interim funding from lenders to stay afloat.
Currently, the airline only operated five aircraft with over25 flights. The airline is expected to operate its last flight for the dayaround 10.30 p.m.
Later in the evening, Jet in a regulatory filing, said thatlate on Tuesday night, the State Bank of India (SBI), on behalf of theconsortium of Indian lenders, told it that they are unable to consider itsrequest for critical interim funding.
“Since no emergency funding from the lenders or anyother source is forthcoming, the airline will not be able to pay for fuel orother critical services to keep the operations going,” the airline said inthe filing.
“Consequently, with immediate effect, Jet Airways iscompelled to cancel all its international and domestic flights. The last flightwill operate today.”
As per the filing, Jet has informed the Directorate Generalof Civil Aviation, the Ministries of Civil Aviation and Finance and otherrelevant government institutions of this course of action.
“Over the last several weeks and months, the companyhas tried every means possible to seek both interim and long-term funding.Unfortunately, despite its very best efforts, the airline has been left with noother choice today but to go ahead with a temporary suspension of flightoperations,” it said in the filing.
“This has been a very difficult decision but withoutinterim funding, the airline is simply unable to conduct flight operations in amanner that delivers to the very reasonable expectations of its guests,employees, partners and service providers.”
The airline said that essential services needed to supportguest services and the re-commencement of the flight operations will be kept onboard until further notice.
“Jet Airways will now await the bid finalisationprocess by SBI and the consortium of Indian lenders.”
In its response to the airline, the lenders said: “TheExpressions of Interest (EOI) have been received and bid documents have beenissued to the eligible recipients today.”
“The bid documents, inter alia, have solicited plansfor a quick revival of the company. The bid process will conclude on 10th May2019… We are actively working to try and ensure that the bid process leads toa viable solution for the company.”
Informing employees about the decision, the airline CEOVinay Dube said: “Late last night we were informed by SBI, on behalf ofthe consortium of Indian lenders, that they are unable to consider our requestfor interim funding of Rs 983 crore.”
“However, we must also be realistic that the salesprocess will take some time and will throw up several more challenges for us,many of which we don’t have the answers to, today.”
On its part, JetPrivilege, which is a separate, independententity, part of the Etihad Aviation Group said: “We would like to assureour members that the value of their JPMiles are secure and remain intact.”
Jet has already folded up most of its operations due togrounding of over 90 per cent of its fleet by lessors.
The cash-starved airline had extended cancellation ofinternational flights till April 18 (Thursday) after last week suspending themtill April 15 (Monday).
Jet’s woes have intensified as the airline that onceoperated around 120 aircraft is now left with just a 16-plane fleet.
It owes over Rs 8,000 crore to the SBI-led consortium oflenders.
On Tuesday, the airline’s scrip on the BSE declined by Rs 19.95, 7.62 per cent, to Rs 241.85 from its previous close of Rs 261.80. The stock market was closed on Wednesday.