News APP

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  gplay

This article was first published 2 years ago  » Business » Problems continue to plague Jet Airways ahead of planned 2022 takeoff

Problems continue to plague Jet Airways ahead of planned 2022 takeoff

By Aneesh Phadnis & Arindam Majumder
January 13, 2022 13:56 IST
Get Rediff News in your Inbox:

Jet Airways is seeing a churn in its senior management ahead of its planned take-off this year.

Sudhir Gaur, accountable manager and acting chief executive officer, is the latest to quit the company.

Finance head M Shivakumar and head of management information system (MIS) Farazad Patrawalla moved out a few weeks earlier.


Gaur had been part of the initial team selected by the Kalrock-Jalan consortium, which secured approval from the National Company Law Tribunal (NCLT) last June to revive the airline.

An Airbus A330 pilot, Gaur was heading the operations team in Jet Airways 2.0 and was involved in key negotiations for airport slots.

P P Singh, head of training and standards in Nepal Airlines, has been selected to replace Gaur as accountable manager.

Singh had worked for Jet earlier and served as senior vice-president (operations) before the airline collapse in April 2019.

Accountable managers are responsible for overall operations in an airline and an appointment to the post requires approval from the Directorate General of Civil Aviation (DGCA).

It could not be ascertained if the replacements had been finalised for the finance and MIS heads.

The consortium did not respond to queries till the time of going to press.

The churn comes as the consortium continues with its efforts to restart the grounded airline.

Though the consortium has expressed optimism about revival, it has several tasks to complete.

While Rakesh Jhunjhunwala-backed Akasa Air has ordered 72 Boeing 737 Max aircraft, the Kalrock-Jalan consortium is yet to finalise its fleet plans.

The consortium is said to be in discussion with lessors to induct a few used Boeing 737s, it is learnt.

Earlier, the consortium approached the NCLT to fast-track the implementation and also declared it would infuse funds to pay all its creditors.

The consortium had even sought December 22 to be taken as the “effective date” for an immediate implementation of the revival plan.

However, the NCLT did not accept the plea and asked the consortium and stakeholders to expedite efforts to revive the airline.

“There is no change in the terms and conditions of the approved resolution plan including timelines for compliance with conditions precedent and effective date will be as per terms and conditions stated in the approved resolution plan and not 22-12-201,” the NCLT said in its order.

Originally the consortium was granted 90 days from June 22 to seek all regulatory permissions and complete formalities for restarting the airline.

Now the timeline has been extended for a second time.

“Lenders have become jittery as the Jalan-Kalrock consortium hasn’t brought in any funds or completed any process to restart business of the airline.

"The lenders will have no other option but to liquidate Jet Airways assets if the situation remains the same,” said a banker involved with the resolution process.

The airline has a fleet of around 11 aircraft, including Boeing 777, 737 and Airbus A330, on its books now.

A person involved in the revival plan, however, said all stakeholders were working towards the revival and denied that there was any disagreement between the consortium and the lenders.

In a statement last month Murari Lal Jalan, lead member of the consortium, had said they were ready with their investments.

“We are aiming to start domestic operations at the earliest in 2022 as a full-service carrier and look forward to create history with Jet Airways’ revival,” he had said.

In the resolution plan approved by the NCLT in June, the winning bidders had agreed to make a cash infusion of Rs 1,375 crore.

According to the resolution plan, assenting financial creditors will get Rs 380 crore, which means a haircut of 95 per cent against the admitted claims of a little over Rs 7,807 crore.

While the consortium has started working at a rapid pace to recertify its air operator’s permit, the process slowed due to lack of funding.

As a result, it has been unable to hire top executives.

“They have not been forthcoming.

"We had given dates to them to start the revival exercise but there has not been any intimation from their side after that,” a senior official of the DGCA said.

Photograph: Vivek Prakash/Reuters

Get Rediff News in your Inbox:
Aneesh Phadnis & Arindam Majumder in Mumbai/New Delhi
Source: source

Moneywiz Live!