After all operations of Jet Airways (India) temporarily came to a halt on April 17, 2019 following 25 years of run, the airline is left under the threat of heading to a bankruptcy court.
As the debt-laden airline was unable to secure emergency funding from the consortium of lenders led by State Bank of India (SBI), the operations had to be suspended. Since no emergency funding from the lenders or any other source of funding was forthcoming, it was therefore not possible for Jet to pay for fuel or other critical services to keep the operations going. Consequently, with immediate effect they were compelled to cancel all their domestic and international flights. Over the last several weeks and months they tried every means possible to seek funding, both interim as well as long term funding, to keep the operations going but were left with no choice, Jet Airways said in a statement it issued announcing the halt of operations.
With Etihad Airways, National Investment & Infrastructure Fund (NIIF), private equity investors TPG Capital and Indigo Partners having put in ‘expression of interest’, SBI had set 10 May as the deadline for submission of ‘binding bids’.
The Tata group is apparently reviving its interest in acquiring Jet Airways but only if the airline goes to bankruptcy, according to media reports. Last year also in November, the Tata group had taken up preliminary discussions to invest in the now cash-stripped airline. However, the group withdrew from talks after gaining the knowledge that Jet Airways founder, Naresh Goyal wanted to retain control over the airline. With the eventually degrading financial situation of once India’s largest airline, Goyal and his wife had to quit from being the board members of the airlines as well as from the operational responsibilities.
Some analysts suspect that the larger idea of the Tatas could be to unify its existing airlines ventures and hope for the acquisition to boost the group’s market share. A combination could be challenging for the rival airline, however with the present situation, nothing can be said as yet.
As of now, Tata Sons Ltd. Holds a presence in aviation through budget airline AirAsia India Pvt. Ltd and full-service carrier Vistara (a joint venture with Singapore Airlines Ltd.).