Grounded Jet Airways has been left without any top-level executive, days after Abu Dhabi-based Etihad put in its letter of interest to re-invest in the airline as a minority partner. While the chances of Jet’s revival appeared bleak without any sign of a majority partner, exit of key officials and a large number of its fleet going to rivals, sources in the know said fresh dialogues were likely to kick off between the Jet lenders and sovereign wealth fund NIIF later this week in an attempt to strike a deal.
‘’There will be talks again for sure to rescue Jet. But everything will depend on Etihad’s conditions,’’ one of the sources pointed out.
The top executives who have put in their papers with immediate effect include Jet’s chief executive officer (CEO) Vinay Dube, chief finance officer (CFO) and deputy CEO Amit Agarwal and company secretary Kuldeep Sharma. Recenty, Jet's chief people officer Rahul Taneja and executive director Gaurang Shetty had also quit, besides other seniors in engineering, network management and corporate affairs teams.
Dube, a former senior executive of Delta Airlines, was appointed CEO of Jet in 2017, a few months after the airline had stitched a wide-ranging commercial partnership with the US carrier. While Agarwal had joined the airline as finance head from Suzlon in 2015, two years later he was designated as Jet’s deputy CEO. Both executives said they were leaving for personal reasons.
Earlier in the day, Etihad top executives led by airline veteran Cramer Ball had a meeting with State Bank of India (SBI) on the various conditions set by the Abu Dhabi carrier. Lenders’ consortium, led by SBI, will need an endorsement from Etihad for any shareholder picking up more than 5 per cent stake in Jet, according to one of the conditions of the Abu Dhabi company. Also, it has agreed to invest an additional amount of only Rs 1,700 crore in the airline through a proposed rights issue.
An Etihad spokesperson did not respond to a query on any discussion with lenders.
Coinciding with the resignations, an anonymous email was doing the rounds among Jet employees, targeting the senior management for corruption, favouritism, mismanagement and causing loss to the company, while giving a clean chit to the airline founder Naresh Goyal.
Jet Airways did not respond to a query on this subject, but a senior executive dismissed the contents of the email as rubbish.
The fast-moving developments followed a letter of interest submitted by Etihad, which currently holds 24 per cent in Jet, just before the deadline last Friday. When the Etihad offer letter was opened on Monday, it was found that there was no binding bid. Also, it had put in stiff conditions, including putting the onus to find a majority investment partner in Jet on the lenders. It has also asked for a substantial write-down of the Rs 9,000-crore loans as a pre-requisite to operate the grounded airline.
On NIIF, a banking source said lenders would negotiate for the wealth fund to invest more than 20 per cent. In an earlier draft resolution plan, which failed to take off, the lenders had preliminary discussions on offering NIIF 19.9 per cent share as the second investor.
Jet Airways grounded its operations on April 17 after running out of cash. Also, more than 60 per cent of the airline's slots have been distributed among others and half of its fleet has been repossessed by lessors.
While junior employees in the airline have not been paid salaries for at least two months, the senior management and pilots, engineers have not been paid since January.