What is the outlook for Jet Airways as it gets a bid from Kalrock?

Jet has got approval of the Committee of Creditors or COC for sale of stake to the consortium of Kalrock Capital and UAE based Murari *** Jalan. This is still subject to the final approval of NCLT and that will come only after assuring that all the NCLT rules and stipulations are adhered to.

Jet has remained grounded since April 2019. There are still are a good number of employees on the rolls, despite the spate of exits. In the last 18 months, SBI took over ownership of Jet Airways as the largest shareholder. However, finding a buyer has been far from easy with most of the fleet repossessed by lessors under international treaties.

The dues are huge, as per the claims filed. Jet apparently owes Rs.40,000 crore and will really need some major haircuts to keep the buyers interested in Jet. Jet owes Rs.13,000 crores to banks and another Rs.27,000 crore to employees and operational creditors taking the total outstanding dues to close to Rs.40,000 crore.

The deal cannot really ignore operational creditors because then it will be tough to get supplies or even supplier credit. Cash and carry is hardly feasible in the present conditions. In addition, there is the massive problem of slowdown in aviation due to COVID-19.