Published: Wed, May 15, 2019
Economy | By

India's Jet Airways slumps following Etihad bid report

India's Jet Airways slumps following Etihad bid report

Jet Airways lenders chose to look out for bidders for the cash-strapped airline after existing shareholder Etihad Airways refused to raise its stake beyond the current 24%.

Debt-ridden Jet Airways on Tuesday announced that its CFO and deputy CEO Amit Agarwal has resigned from the company citing "personal reasons".

Earlier on Tuesday, Amit Agarwal, Chief Financial Officer (CFO) and deputy CEO and, Rahul Taneja, Chief People Officer (CPO) resigned from the beleaguered airline. He holds a Master's degree in Operations Research from the University of North Carolina. Prior to Jet Airways, he was the senior vice president-Asia Pacific for Delta Airlines. At the closing bell, the stock price ended 7.42 per cent lower at Rs 129.10 on BSE and Rs 128.90, down by 7.33 per cent, on the NSE.

The lenders, whom Jet Airways owe over Rs 8,000 crore in debt, are offering 31.2 per cent-75 per cent stake in the company on a fully diluted basis.

This comes days after Etihad Airways gave a highly conditional bid to invest in Jet Airways and said it would not be able to invest more than Rs 1,700 crore, a fraction of what Jet needs to revive. Shares of the carrier, which have tumbled nearly 70 per cent over the past year, were down 5 per cent at Rs 144.3, as of 0445 GMT.

Dube took over as the airline's CEO in August 2017, filling in a spot that had been vacant since early 2016.

The airline seized operations temporarily around mid-April due to acute liquidity crisis.

Several top executives and board members have quit the airline.

With this, the lenders would have no problem in entertaining the already received two unsolicited bids if their proposals are anyway better than the one offered by Etihad.

Among its conditions, Etihad Airways, which owns about 24% stake in Jet, wants an exemption from an open offer that may be triggered by a change in ownership structure of Jet Airways. It is under the management control of State Bank of India-led consortium of lenders following a debt-restructuring plan.

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