Lenders to Jet Airways will hold a meeting of the committee of creditors (CoC) next week to decide the future course of action, as the Colombian Synergy Group, the only entity which evinced an interest in the airline, is yet to firm up its plans. The CoC, which had given time till December 16 for Synergy Group to present a resolution plan, may consider further extension, as no other options remain, by sources.
“We will be having a CoC next week and we will consider it (giving further extension to the Synergy Group), and a future course of action” said a person involved in the insolvency process. The CoC has already given two extensions to the Synergy Group, which has multiple issues holding it back from making a commitment. FE had last month reported that the Synergy Group was doubtful about the recovery of slots earlier allotted to Jet Airways and was particularly seeking clarity on the London Heathrow Airport slots.
The National Company Law Tribunal (NCLT) recently made the civil aviation ministry a party to the insolvency proceedings, so that the government could provide clarity on the slots which erstwhile belong to Jet Airways. “The ministry of civil aviation representatives have been made party to the insolvency proceedings, but they are yet to appear before NCLT. Hopefully they will appear in court soon and give some clarity,” the person said.
Meanwhile, the value of Jet’s few assets have deteriorated significantly since it was grounded nearly eight months ago. The Boeing 777 in Jet’s fleet, even while it is being maintained, less than halved in value after 90 days of being grounded. At the same time, maintenance service providers have been charging higher prices for maintenance of the Jet fleet, sources said. Insolvency proceedings may also come to a grinding halt if the banks do not disburse the approved initial emergency funding of nearly `70 crore to run maintenance and other insolvency costs. “So far, we have received only about `18 crore from three banks, including the State Bank of India,” a person from the resolution professional’s team told sources.
Insolvency proceedings against Jet Airways were initiated in June, and the NCLT bench had called for expeditious resolution of the airline given it was a matter of “national importance”. However, the 180-day resolution deadline as mandated under the Insolvency and Bankruptcy Code, 2016 (IBC) ends on December 16. The resolution professional for the airline, Ashish Chhawchharia, has filed a petition at the NCLT seeking a 90-day extension of the timeline, as permitted under IBC. As on October 20, total claims against the beleaguered Jet Airways stood at `36,090 crore, of which the RP has so far admitted over `14,640 crore.