Cash-strapped Jet Airways and its stakeholder Etihad seem to be failing to find a permanent solution to the airline's financial woes, with the company staring at another payment default of $109 million by March 28. Jet Airways has to pay $109 million of total $140 million loan it had taken from HSBC Bank Middle East, in which Etihad was a guarantor. Jet had also defaulted on its earlier payment of $31 million to HSBC as part of its external commercial borrowings. With the SBI-led resolution plan yet to see the light of the day, Jet Airways is likely to default to the another tranche.
Etihad, which was the guarantor in both the cases, has protected its interest through a clause under which Jet had pledged 15 per cent of shares in its loyalty programme unit JetPrivilege, reported Business Standard. JetPriviledge has an estimated value of Rs 4,000 crore, with 51.1 per cent stake held by Etihad only.
Banks have asked both Jet Airways and Etihad to find a middle ground to rescue the airline and have refused to pump in more money until the resolution plan is put in place. Analysts suggest it seems unlikely that Etihad will infuse money into Jet unless Goyal agrees to limit his stake below 22 per cent.
Jet Airways had withdrawn five more aircraft from service owing to non-payment of lease rentals on March 13, taking the total number of such non-operational aircraft to 37. Naresh Goyal this week said more than 50 aeroplanes were not in operations. The Jet Airways Chairman had sought urgent funding of Rs 750 crore from Etihad, which owns 24 per cent stake in it. He wrote the airline was in a "very precarious" position, which had only worsened following the grounding of 50 of its planes. Goyal also said that if interim funding was not received at the earliest it would be severely "deleterious" to the future of the carrier and could even result in its "grounding".