New Delhi, Jun 18: Jet Airways shares lost over half of its value on Tuesday following its lenders' decision to initiate bankruptcy proceedings against the grounded airline.
Jet Airways stocks hit an intra-day low of Rs 32.25 per share, falling by a massive 52 per cent. At 1.41 p.m, Jet's stocks were trading at Rs 38.05 per share, down Rs 30.25 or 44.29 per cent.
SBI-led lenders consortium on Monday said that they have decided to seek resolution under Insolvency Bankruptcy Code.
"A meeting of lenders was held today to consider the way forward in respect of Jet Airways. After due deliberations, lenders have decided to seek resolution under IBC since only a conditional bid was received and requirement of the Investor for SEBI exemptions and resolution of all creditors is possible under IBC. Lenders led by State Bank of India have been taking efforts to find a resolution for Jet Airways outside IBC but in view of the above, Lenders have decided to seek a resolution within the IBC process,” they said in a statement.
Besides owing Rs 8,500 crore to public sector banks, the airline has a total liability of about Rs 25,000 crore which includes dues of operational creditors.
Earlier this month, two of the airline’s suppliers — Shaman Wheels and Gaggar Enterprises — moved the National Company Law Tribunal (NCLT) and sought that insolvency proceedings be initiated against the company. NCLT was to hear the matter on June 13. However, no one from Jet Airways showed up after which the matter was adjourned to June 20.
Jet Airways owes Shaman Wheels Rs 6.17 crore, while it owes Gaggar Enterprises Rs 53 lakh. A court-approved notice will be sent to Jet for this hearing and if it fails to show up again, the court may proceed with the matter.
Additionally, multiple reports indicate that the National Aviator's Guild, the body of Jet pilots, is also planning to move the NCLT to initiate insolvency proceedings to recover unpaid salaries.
Running out of cash, Jet Airways suspended its entire operations on April 17. Subsequently, the government re-allocated its slots and foreign traffic rights to rival carriers.
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